Investors Scramble For MTN Shares After Listing On NSE.
By Chukwumah Kelechukwu
Demand for the shares MTN Nigeria, a part of the MTN Group, soar to over 100 million units but only about five million units were traded after the premium stock was admitted on the Premium Board of the Nigerian Stock Exchange (NSE) on Thursday.
The NSE listed by introduction, 20.35 billion ordinary shares of MTN Nigeria Communications Plc at N90 per share, lifting equity capitalization of the Exchange by N1.83trillion to N12.525trillion at the close of trading on Thursday.
Tajudeen Olayinka, Chief Executive Officer of Lagos-based Valmon Securities Limited, told InsideBusiness that the shares were in hot demand but shareholders were largely unwilling to sell considering the profits they anticipate from capital gains in the weeks ahead dividend payouts at year end.
He said that in less than 15 minutes after the shares were listed, the stock met the condition for price mark up, closing at N99 per share. This implies that shareholders who offered to sell gained N9.0 per unit of the stock.
According to him, demand pressure for the stock would likely continue on Friday to the weeks ahead with the price steadily rising higher, which partly explained why shareholders held back from selling after lusting.
At the N90 per share listing of the stock, Olayinka said that shareholders who subscribed at private placement or bought the stock over the counter (OTC) in 2007 have since recouped their initial capital invested in the equity.
A link unit of the stock comparising 50 ordinary shares and one preference share were offered at about $1000 in 2007.
InsideBusiness gathered that the company has indicated interest to redeem the preference shares at a premium 90 Cent per preference share.
MTN Nigeria, a part of the MTN Group, Africa’s leading cellular telecommunications company, is the first telecommunications network provider to be listed on the NSE Premium Board, a listing segment for the elite group of issuers that meet The Exchange’s stringent corporate governance and listing standards.
The Board currently features Dangote Cement Plc, FBN Holdings Plc, Zenith International Bank Plc, Access Bank Plc, Lafarge Africa Plc, Seplat Petroleum Development Company Plc and United Bank for Africa Plc.
Admitting the shares on Thursday, May 16, 2019, NSE National Council President, Otunba Abimbola Ogunbanjo, said, “We are particularly pleased that MTN Nigeria has joined the prestigious club of companies listed on our Premium Board with this landmark transaction, which will differentiate it as a professionally run telecommunications company with high standards, having met The NSE’s listing criteria.”
He noted that the Premium Board listing represented its commitment to strong corporate governance, excellence, professionalism, efficiency in service delivery and providing increased returns to shareholders.
“It is our expectation that the MTN Nigeria listing, which is the NSE’s 2nd largest, will encourage other telecommunication companies to list their shares on The Exchange, thereby opening the sector up to cheaper, long term capital that will boost innovation and development,” Ogunbanjo said.
Also commenting, NSE Chief Executive Officer, Mr. Oscar Onyema, said, “We are delighted to welcome MTN Nigeria to the Exchange. Today’s listing is a promising development in the country’s telecommunications sector and we encourage other players in the sector to explore the different opportunities in the capital markets for raising long term capital. As a listing platform of choice, today’s listing will add to our bouquet of diverse investment offerings to the public.
“Having MTN Nigeria listed in our market is a testament of The Exchange’s commitment to building a dynamic and inclusive market and creating channels for sustainable investment. This listing will promote liquidity for MTN Nigeria, enhance its value and increase transparency, as our platform remains one of the best avenues for raising capital and enabling sustainable growth for national development,” said the NSE boss.
The listing of the telecommunication giant brings to two, the number of companies that have listed on the Exchange this year after the listing ofSAHCOL Plc end of last month.
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