Amidst its crisis in Nigeria, MTN Group Limited has attracted a huge investment from the Public Investment Corp.(PIC) , Africa’s biggest fund manager for the second time in as many days, taking advantage of a price that’s close to 10-year lows.
The PIC’s shareholding is almost 26 percent, Johannesburg-based MTN said in a statement on Thursday. The previous day, Africa’s largest wireless carrier by sales said the stake had increased to about 24 percent.
“We believe MTN has a strong set of assets and competencies,” Deon Botha, head of corporate affairs, said in emailed comments, declining to say more about the PIC’s rational for boosting its stake.
MTN’s share price has plunged by 19 percent since Nigerian authorities in late August alleged that the company had illegally transferred $8.1 billion out of the country. The carrier is also on the hook for $2 billion in back taxes in Nigeria, its biggest market. However, there are signs that at least the first matter may be resolved, with Central Bank Governor Godwin Emefiele saying last week the two sides are on “the verge” of announcing a deal.
The shares rose 1.5 percent to 89.73 rand as of 4:30 p.m. in Johannesburg on Thursday, valuing the company at 169 billion rand ($12 billion).
“There’s been positive rhetoric on a resolution in Nigeria and so that helps,” said Ruhan du Plessis, an analyst at Avior Capital Markets in Cape Town. “It seems the PIC is comfortable buying into MTN at these levels.”
The PIC is Africa’s largest money manager with more than 2 trillion rand under management. The Pretoria-based company is state owned and looks after South African government worker pension funds.
About Post Author
NLC gives govs Dec 31 deadline for new minimum wage implementation
Banks refund N76.7bn, $20.9m to customers —CBN
MTN, Glo, Airtel, 9Mobile, ntel, lose N119bn revenues monthly
Who will fund Rosneft's $157bn mega oil project?
Nigeria to spend N750.81bn on fuel subsidy in 2020
Senate probes CBN over N20tn unremitted stamp duty
Surprise crude oil build threatens oil rally
CBN: Electronic payments hit N424tn in nine months
Nigeria, Ghana top list of markets to watch for key LNG project developments
CBN to raise LDR to 70% by 2020