MTN Nigeria, the country’s largest mobile network operator, has successfully raised ₦75 billion through its commercial paper issuance program, exceeding its initial target of ₦50 billion. The oversubscribed Series 11 and 12 issuances represent a key step in MTN’s ₦250 billion Commercial Paper Issuance Programme, underscoring strong investor confidence despite a challenging fiscal year.
Investor Confidence Amid Financial Headwinds
The offering, which was 150% oversubscribed, attracted significant interest from asset managers, banks, insurance companies, and other institutional investors. This enthusiasm comes despite MTN Nigeria reporting a ₦514.9 billion loss after tax for the nine months ending September 30, 2024. The loss stemmed primarily from a ₦904.9 billion net foreign exchange loss caused by the devaluation of the Naira, which sharply increased the company’s finance costs.
Operational Strength Drives Optimism
Despite the financial headwinds, MTN Nigeria demonstrated resilience through robust operational growth. Key highlights include:
- Service Revenue Growth: Service revenue grew 33.6% year-on-year to ₦2.35 trillion, driven by surging demand for data and fintech services.
- Data Services Boom: A 52.3% year-on-year increase in data usage underscored the growing importance of digital connectivity.
- Fintech Expansion: Fintech services also rose by 18%, contributing to the company’s diversified revenue base.
Allocation and Exclusions
The funds raised through the commercial paper issuance will support MTN’s daily operations and immediate financial obligations. While the issuance attracted broad institutional participation, pension funds were excluded due to a temporary suspension by the National Pension Commission, pending updated guidelines from the Securities and Exchange Commission.
Strengthening Financial Position
The success of this fundraising effort highlights investor trust in MTN Nigeria’s capacity to navigate a volatile economic landscape and leverage its market leadership to drive future growth. By securing ₦75 billion, MTN has fortified its financial position to address operational needs while capitalizing on growing demand for its services.
This milestone not only reflects MTN Nigeria’s resilience in a turbulent year but also signals its commitment to meeting stakeholder expectations and advancing its strategic objectives in the telecom and fintech sectors.