The Nigerian arm of African mobile telecommunications behemoth MTN Group Limited today listed its business on the Nigeria Stock Exchange. MTN Nigeria Communications Plc. went live at 2:14 pm local time, allowing trading for only 16 minutes before the markets closed.
In that short period, however, the company was able to become the second most valuable entity on the stock exchange. Offering its shares at $0.25, the telecom company saw a 10 percent rise in this price.
By 2.30 pm, the company was worth $5.54 billion, ranking behind only Aliko Dangote’s Dangote Cement which commands an $8.3 billion valuation.
Running under the MTNN ticker, the company only listed 20 billion ordinary shares instead of going public through an IPO. MTN claims that this is because it would be quite difficult to get a fair valuation prior to the IPO given that it is still embroiled in a drawn-out dispute with regulatory authorities in Nigeria.
Speaking to Bloomberg, MTN Chief Financial Officer Ralph Mupita was of the opinion that the company wouldn’t go public via IPO until it cleared an alleged tax bill of $2 billion.
A similar story involving the company played out in Ghana, its third largest market. MTN had to go public via an IPO in order to get a license for rolling out a 4G network.
Back in its largest market, the public listing turned around the dire fortunes of a faltering Nigerian Stock Exchange. After 8 days of losses on the trot, the MTN listing saw the market close half a percentage point up.
This piece of good news could assuage public vitriol against the South African based wireless carrier. Across the continent, many believe the company repatriates huge profits back to its homeland instead of further investing them in the area of operations.
News of an impending IPO will not only offer the public a part of the carrier but also help to paint the company in a better light. Currently, locals only own around 20 percent. With the IPO, there’s a chance to own 35 percent.