Africa’s largest network, Mtn recently announced plans to list its Nigerian entity on the Nigerian Stock Exchange.
Based on current Valuation, the Nigeria entity could be work over 15% of the entire market capitalization of the stock exchange by the time it list.
Unfortunately, by the time it lists the company could be worth much less. The South African owned mobile giant has recently informed investors that it could be on the hook for a half year loss due to the hefty Nigerian fine.
The company recently negotiated a N330 billion reduced fine with the Nigerian Government which it expects to pay off over the next one
The company announced that its headline loss was expected to come in a range of 285 cents to 255 cents per share in the six months to ended-June.
The net effect of the Nigerian entity results in a negative impact of 474 cents per share.
The company also complains that its half year results was also affected by the under performance of MTN Nigeria.
With a string of bad results and hefty fines it appears though that the Nigerian entity might end of listing a company in a state of decline.
Apart of the company’s financial and operational challenges, it also faces other issues such as intense completion from mobile apps, who offer voice calls, cheaper data cost which is now driving margins down and well as competition from smaller but more nimble competitors.