Tuesday, May 7,2019
- Listing excites stock market community
Telecommunications giant, MTN Nigeria, has formally applied for listing by introduction on the Nigerian Stock Exchange (NSE). The Securities and Exchange Commission (SEC) made the disclosure yesterday. “SEC can confirm that we are in receipt of an application from MTN requesting for registration of their existing securities.
“They have applied for listing by introduction which will enable the company to be listed and allow shareholders sell their shares on the floor of the exchange. Their application is presently receiving attention,” SEC’s Head of Corporate Communications, Mrs. Efe Ebelo, said in a statement sent to our correspondent. Preparatory to its listing on the NSE, MTN Nigeria recently said it has completed its conversion from a private company to a public liability company (Plc.). The company, earlier in the year, announced plans to list before July after failing to do so last year as promised.
However, it said the listing is also subjected to resolution of the ongoing court case over alleged $2 billion tax defaults. The conversion to a Plc. is a legal requirement and key milestone in the preparatory process for MTN’s listing by introduction on the Nigerian bourse.
MTN’s intended listing on the NSE will create a new telecoms asset class for investors and provide a wider group of Nigerians with a chance to participate in the MTN investment opportunity. Speaking on the announcement, the MTN CEO, Ferdi Moolman, said: “Our conversion to a Plc. is a major step towards listing by introduction on the Nigerian Stock Exchange in the first half of 2019. It is a reaffirmation of our long-term commitment to expanding investment opportunities for Nigerians, in addition to providing everyday services to them. We look forward to continuing our engagement with the SEC and NSE to take forward the listing process.”
Meanwhile, capital market operators have lauded MTN Nigeria’s application to SEC for listing by introduction, saying that it would deepen market liquidity. The market operators stated this in an interview with the News Agency of Nigeria (NAN).Uche Uwaleke of Nasarawa State University, Keffi said that the development would add additional N2 trillion to the market, when perfected. Uwaleke, now a research fellow at SEC, said that the market capitalisation of NSE would be deepened with the coming of MTN. “We are happy about the development because it will further deepen the market if MTN comes, we are looking at additional N2 trillion being added to market capitalisation and it will make MTN the second largest quoted company in Nigeria after Dangote Cement,” he said. Uwaleke said that listing of MTN would help in product diversification at the exchange.
“This will help to diversify concentration, we will now have telecommunications, industrial sector and not when it’s only Dangote. “It’s a welcome development and the capital market community is in jubilation mood and we are anxiously waiting for that to materialise, because it will help to deepen the market and give Nigerians the opportunity to partake in the fortunes of MTN,” Uwaleke stated. He noted that MTN listing would widen the choices of both local and foreign investors in terms of investment decision. “It is also a door opener for other multinationals to come and be part of success story of Nigerian capital market by seeking listing, especially those in telecommunications sector such as Globacom and Etisalat, among others.
“We expect the big four to come and list on the exchange. The same with oil companies,” Uwaleke said. Also speaking, Sheriffdeen Tella, Professor of Economics, Olabisi Onabanjo University Ago- Iwoye, Ogun State, said that it was a good development for the stock market. “It means that capital market is good because when you have such company listed on the exchange, it means stock exchange is very active, it means more recognition for NSE. “With the listing, they will be able to mobilise some funds first and if they are unable to meet their target, they can now go further with public offering. But it’s a good development for the capital market,” Tella said. He, however, called for review of the nation’s industrial policies to attract more listing on the exchange. “There should be a revised policy so that companies coming will know what and what they should do. The policy will also give them incentives that will attract them to list,” Tella said. Mr. Sola Oni, a chartered stockbroker and Chief Executive Officer, Sofunix Investment and Communications, said the market had been yearning for such a listing. Oni said that the quantum of shares would increase the market capitalisation, thereby making the market more attractive. He noted that it was a positive signal to the companies in the oil industry.