Emerging markets telecoms giant MTN Group Ltd plans to sell $500 million worth of shares of its Nigerian unit to the public by July in fulfillment of its record-fine-settlement deal with the Nigerian Communications Commission.
According to Reuters, the South Africa-based company had a board meeting on Wednesday on the deadline and a decision has been reached to pick a PR firm to manage publicity of the massive initial public offering. Standard Bank Group Ltd. and Citigroup Inc. are also acting as advisers on the move.
MTN originally fixed 2017 to list on the Nigerian Stock Exchange but deferred due to an unfavourable economic recession at the time.
MTN’s $500 million offer if successful as expected, will be the second-largest on the Nigerian bourse after Starcomms $796 million public raise in 2008.
MTN is the leading telecoms operator in Nigeria and has an estimated 51.3 million subscribers. The Nigerian unit is crucial to the Group and contributes a third of its global earnings. In 2015, MTN Group’s revenue was over $15 billion.
October 2015, the mobile-phone company was fined $5.2 billion for missing a deadline to disconnect unregistered subscribers in Nigeria amid a security breakdown. A penalty that led to the resignation of the CEO and the company witnessing a first ever full-year loss due to a slump in its share price.
After series of dialogue, the fine was reduced to $3.4 billion in December, and by June 20116, the fine was further cut to $1.7 billion, to be paid in instalments. The final penalty also attracted an order for the highly lucrative privately-owned company to go public.
MTN also agreed to sell shares in Ghana, as one of the conditions of a deal to gain spectrum rights.