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Interswitch Halts IPO Over Nigerian Forex Crisis

By Modupe Gbadeyanka

The shortage of Dollar supply in Nigeria has forced Interswitch Limited to suspend its plans to raise about $1 billion through an initial public offer (IPO).

It is believed that once things get better, the plan would be activated.

Nigeria is facing acute shortage in foreign exchange due to fall in the global price of crude oil as well as reduction in the volume of oil it produces as a result of attacks on oil installations in the Niger Delta by militants in the region.

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The Dollar shortage in circulation has weakened the Naira against the foreign currency used in global trading.

The Naira trades at about N490 to the Dollar and this has forced some companies to leave the country or alternatively raise prices of commodities or services.

In the case of Interswitch, which plans to be listed on both the Nigerian and London Stock Exchange, its Chief Executive Officer, Mr Mitchell Elegbe, noted that the macroeconomic situation in Nigeria is the determining factor suspending the move.

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He said for now, the company will only focus on how to expand its operations to Kenya, Tanzania, Uganda and Gambia.

It is believed that the dual listing could make Interswitch worth more than $1 billion.

In 2015, the firm said it met with banks including Bank of America Corp., Barclays Plc and Standard Bank Group Ltd. about a potential 2016 share sale in Lagos and London.

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The IPO would have enabled London-based private equity group Helios Investment Partners LLP, a shareholder, to return some money to investors.

Interswitch processes payments for banks and owns a brand of debit cards in Nigeria. It has issued more than 15 million payment cards in Nigeria

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Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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