MTN Eyes N100bn Commercial Paper Sales for Operating Expenses

By Dipo Olowookere

A leading telecommunications firm, MTN Nigeria Communications Plc, seeks to raise N100 billion from commercial paper sales for operating expenses.

The company, which recently became the first organisation on the Nigerian Exchange (NGX) Limited to generate N2 trillion as revenue in a financial year, is selling the corporate debt instrument under its N150 billion commercial paper issuance programme.

In the details of the exercise, the telco with the highest market share in Nigeria will use the proceeds from the offer to support its working capital and general corporate purposes.

MTN Nigeria is selling commercial paper in Series 4 and 5. Subscription for the paper commenced on Monday, February 20, 2023, and will end on Thursday, February 23, 2023.

The series 4 with a 186-day tenor is being offered at a discount rate of 9.52 per cent, while the series 5 with 270 days tenor is 10.60 per cent.

The minimum subscription is N5 million, according to details of the exercise, and the commercial paper can be purchased through registered brokerage companies in Nigeria.

Business Post reports that the arranger of this deal is Stanbic IBTC Capital, while the dealers are Stanbic IBTC Capital, Chapel Hill Denham Advisory, Coronation Merchant Bank, FBNQuest Merchant Bank, and FSDH Capital.

MTN Nigeria is the largest communications services provider in the country, with over 75.6 million mobile subscribers.

Last year, the company introduced 5G services in Nigeria and has seen a significant improvement in active data subscribers, though the introduction of Starlinks in the country poses a threat to MTN and other internet service providers.

However, the firm provides financial services to Nigerians through its mobile money business, MoMo, with about 2 million active wallets since the launch of its PSB in 2022, driving financial inclusion in a young and fast-growing population.