Nigeria and Africa’s largest mobile phone company, MTN Group has confirmed that it plans to list the Nigerian subsidiary on the Nigerian Stock Exchange in 2017.
This follows a deal reached with the Government a few weeks ago that led to a reduction of its fine to $1.7 billion over unregistered sim card registration.
The Nigerian Stock Exchange is currently worth about N1o trillion or ($31 billion) compared to MTN’s $18 billion (market value on the Johannesburg Stock Exchange). MTN EBITDA contribution is reported to be about 40% of MTN’s total EBITDA suggesting that MTN nigeria’s market value could be about $7.8 billion or around 22% of the Nigerian Stock Exchange.
Dangote Cement has a market capitalization of about $10b, about 26% of the NSE marker capitalization.
As such, MTN’s listing of all or some of its shares is expected to help deepen the local stock market and attract more unlisted companies to list in Nigeria.
Some of the benefits of listing in a stock exchange include the following;
- Helps the listed company raise capital
- Gives shareholders of the company an exit to sell shares
- Ensures there is liquidity in the shareholdings of the company