• World
  • Columnist
  • Commodities
  • WORLD BUSINESS & ECONOMY
  • Executive Knowledge Series
  • Finance
  • Manufacturing
  • Markets
  • Risk & Governance
  • Small Business
  • Technology, Media & Innovation
  • Comments
  • Business AM WebTV
  • Login

Businessamlive
  • FRONTPAGE
  • FINANCE
    • AllAsset ManagementAuditBankingBondBudgetCapital MarketsC&I LeasingCurrencyDealDebt marketForexFund RaisingFundingGovernmentHedge FundsInsuranceInvestmentInvestorInvestor ServicesMergers & AcquistionsMoney marketTreasury BillsMortgagePensionsPersonal financePonziQuantitative EasingshareTaxationTSAWealth Management
      Finance

      Nigeria, Africa remittances on target as Wari, Lycaremit sign partnership

      January 21, 2021

      Companies

      Total Nigeria, Mixta, Valency, list new CPs on FMDQ platform to enhance financial markets development

      January 19, 2021

      Finance

      Amidst N32.22trn public debt, analysts say Nigeria’s external debt service manageable

      January 19, 2021

      Finance

      Stringent regulations, business environment forced Stanbic IBTC out of BDC business

      January 15, 2021

  • MARKETS
  • ECONOMY
    • AllAfricaAgricAirportsAmericaAsiaAustraliaBreakthroughDealEuropeForeign InvestmentsforexGlobal marketGovernanceIMFMiddle EastNECANigeriaOutlookRich listSouth AfricaSport BusinessTradeU.KWest AfricaWorld Economic forum
      Africa Investment Forum

      Africa’s $60bn losses in illicit capital flows due to multinationals’ tax avoidance, says AfDB Adesina

      10 hrs

      Frontpage

      Covid-19 vaccine: Nigeria, 54 others to benefit from African Union’s 270m doses

      January 21, 2021

      Finance

      Nigeria, Africa remittances on target as Wari, Lycaremit sign partnership

      January 21, 2021

      WORLD BUSINESS & ECONOMY

      AfDB signs investment partnership with EIB to fast track development in Africa

      January 21, 2021

  • COMMODITIES
  • ENERGY
    • AllConferenceElectricityOil and GasPowerRenewable
      Frontpage

      OPEC welcomes push for electric vehicles, but says fossil fuel remains strong

      January 21, 2021

      National: Governance, Policy & Politics

      Nigeria ramps up domestic LPG consumption above 1MMT, says PPPRA

      January 20, 2021

      Companies

      TIPP Oil, German lubricant maker, targets 2021 Nigeria launch with eco-friendly scheme  

      January 19, 2021

      Frontpage

      Nigeria aims for cost efficiency, safety, value in oil sector with centre of excellence

      January 19, 2021

  • TECHNOLOGY
  • MANUFACTURING
  • ANALYSIS
    • Analyst Insight

      CBN meeting and NSE in focus

      January 18, 2021

      Analyst Insight

      Once again, fiscal stimulus takes centre stage

      January 18, 2021

      Analyst Insight

      Organisations must learn from the WhatsApp story  

      January 18, 2021

      Analyst Insight

      Data privacy maturity model in organisations

      January 11, 2021

Frontpage

MTN’s $500m IPO foot-dragging linked to pre-election year jitters

July 16, 2018728 views0 comments

*Analysts say listing should be in Q2 2019
With the second quarter of 2018 gone and the impending electioneering period, any official move by MTN Nigeria on initial public offering (IPO), which is a requirement to list on Nigerian Stock Exchange (NSE) will tantamount to an unwise business decision, according to analysts.
This explains the obvious foot-dragging by the telecoms operator pressured by the Nigerian authorities to list to fulfill an earlier agreement for the reduced $1.7 billion in a settlement with the Nigerian Communications Commission (NCC) over unregistered SIM card violation. According to market analysts who spoke to business a.m., data have shown that electioneering period in developing nations like Nigeria begets uncertainties and trepidations, which almost always cause devaluation of equities, loss of interest, and limit the confidence level of potential investors.
While IPO operates under the principle of demand and supply, these situations will have a huge negative impact if the largest network operator forges ahead this year, they stressed. By implication, MTN Nigeria would be on a thorny journey as a result of the timing as analysts say IPOs do not yield a promising result in a period when a presidential election is almost at the corner.
“I do not expect many international institutional investors to open their purses until the politics plays out,” Ndubuisi Ekekwe, a professor and young global leader at World Economic Forum told business a.m. “That will depress liquidity in the market and when that happens, prices of stocks go down. IPOs are never done in such occasions.”
He said listing on the NSE in 2018 would be regarded as carelessness considering the presidential election, which is on the horizon as elections in Africa typically bring uncertainties, triggering devaluations of equities across markets.
“So, for MTN Nigeria, I do think the strategists would move this IPO to Q2 2019 to happen after the election. If I am advising them, that would be the first point on slide. Going public in 2018 will cost you 15-20 percent because of the looming presidential election in Nigeria, which could depress international and Nigerian diaspora interests,” he concluded. However, political and market trends have shown that potential international investors usually come out to invest post election period, as this time guarantees some level of confidence due to stability in the economic policies.
To this end, MTN Nigeria stands a better chance of having a better valuation on its IPO following the outcomes of the presidential election in 2019. Gbenga Adigun, asset manager and cofounder at Graduate Skills Development Centre puts this in perspective: “There is always a high wave of optimism in the markets whenever there is a smooth transition of power.
A 2019 float would give MTN a better valuation.” Speaking on the matter, Peter Okoro, CEO at Bentorson Integrated Services, said venturing into a new business right now would not be a good idea for MTN as business activities are already feeling the pressure due to political uncertainties as associated with elections, adding that foreign partners don’t grant credit facilities anymore until maybe after elections 2019. MTN Nigeria has been on the move to list on the NSE since 2016 after agreeing to pay off a reduced fine worth $1.7 billion in a settlement with the Nigerian Communications Commission (NCC) over unregistered SIM cards without an official conclusion.
The news intensified a few weeks ago when different media outlets reported that MTN was almost concluding plans with the Security and Exchange Commission (SEC) to issue IPO in August, a reportage which warranted the NSE to issue a contradictory statement on its website. According to SEC, MTN Nigeria has not met the necessary regulatory demands by filling an application with the commission for it to review its plan to embark on an initial public offering (IPO) in Nigeria’s capital market. “Neither MTN Nigeria Limited nor any of its advisers or representatives has filed any application with the SEC regarding the said IPO,” the regulator said.
Share on Facebook Tweet Email
TagsMTN Nigeria Ndubuisi Ekekwe Nigerian Communications Commission Nigerian Stock Exchange
PreviousDeutsche Bank shares rose by 9.1%, higher than analysts expected
NextAfDB, Afreximbank sign strategic factoring project to support African SMEs

Leave a comment

- Cancel reply

MARKET DATA

Market Videos

Recent Posts

  • Africa’s $60bn losses in illicit capital flows due to multinationals’ tax avoidance, says AfDB Adesina
  • Nigeria equities go bearish on selloffs in DangCem, AXA Mansard, UBA
  • Covid-19 vaccine: Nigeria, 54 others to benefit from African Union’s 270m doses
  • Morrison Industries taps Oladejo, business consultant, as MD to drive expansion plans
  • Experts canvass exposing farmers to Agri-Insurance to minimize economic losses in sector

World

Africa

Buhari, Okonjo-Iweala congratulate Adesina over reelection as AfDB President

Europe

EU businesses to cut investments in 2020, says EIB report

America

U.S. increases cost of visa application for Nigerians

Africa

Thatcher-Loving Nigeria Candidate Plans to Overhaul Economy

Africa

AfDB scales up industrialization pace on the continent, delivers improved business access to finance, skills, energy

Frontpage posts

0

Oil up on weaker dollar, high U.S. inventory

Frontpage July 23, 2020

1
2

FG injects N600bn into power sector

Frontpage August 21, 2019

3

FG earns N52.7bn from solid minerals in one year

Frontpage October 28, 2019

4

Three forex windows benefit from CBN intervention targeting rates stability

Frontpage April 24, 2018

5

Lafarge Africa reports 173% growth in nine months

Frontpage October 29, 2019

SUPPORT

  • Photo Gallery
  • Help Centre
  • About Us
  • Accessibility

LEGAL & PRIVACY

  • Terms & Conditions
  • Privacy
  • Cookies
  • Copyright

SERVICES

  • Conferences & Events
  • Analysts Research
  • Advertising Rate
  • Ebooks

TOOLS

  • Portfolio
  • Newsletters
  • News feed
  • Currency Converter

SUBSCRIBE

Join us to get latest updates on business related news.

[mc4wp_form id="3076"]
  • ABOUT US
  • CONTACT US
  • CAREERS
  • TERMS & CONDITIONS
  • PRIVACY POLICY
Copyright 2017. All rights reserved. BusinessAMLive. A Businessnewscorp Member Company.