MTN Boosts Ghana Stock Exchange Following Positive Debut

Written by Peter Pedroncelli

 

South African mobile operator MTN listed on the Ghana Stock Exchange this week, boosting the Accra-based bourse and growing its share price among local investors.

The price of shares in MTN’s Ghana unit increased by four percent to $0.16 on its stock market debut on Wednesday, according to Moneyweb.

The Ghana unit of Africa’s biggest mobile phone company by subscribers began trading 1.5 million shares on the Accra-based exchange after an initial public offering that yielded $238 million.

The exchange was boosted by MTN’s 1.5 billion shares as the first telecoms company on the bourse, with only 323 million shares traded during the entire year in 2017, according to Businesstech.

The listing attracted attracted thousands of individual investors, making MTN Ghana three times bigger than the next largest Ghana IPO.

Ghana stock exchange
MTN’s Ghana unit enjoyed a successful debut on the Ghana stock exchange this week. Photo – AP – Sunday Alamba

MTN had agreed to sell shares in Ghana as one of the conditions of a deal to gain spectrum rights. The company will make 35 percent of its shares available to investors on the Ghanaian Stock Exchange, according to ITWebAfrica.

The company originally aimed to list in Ghana during 2017, but the process was delayed. The decision to list on the Ghanaian exchange was reached as part of the terms of agreement for the acquisition of a 15-year, $67-million 4G license in 2015.

Nigeria and Uganda following success on Ghana Stock Exchange

Following the successful debut of MTN’s shares on the Ghana stock exchange, there are plans underway for a listing in Nigeria and perhaps even Uganda.

Africa’s biggest mobile phone company by subscribers will make 30 percent of its Nigerian shares available for listing on the Nigerian Stock Exchange, with those shares worth around $512 million, according to ENCA.

The stock exchange listing was one of the settlement conditions placed on the telecoms giant after Nigeria fined MTN $5.2 billion for missing a deadline to disconnect unsubscribed Nigerian customers.

Most of the shares will be sold to Nigerian institutions and individuals. MTN is the biggest tax contributor, biggest employer and biggest company in Nigeria, and now Nigerians will be able to own a piece of the mobile operator through the shares.

The successful share sale would be the biggest on the Nigerian Stock Exchange after Starcomms, which raised $796 million with its 2008 listing, according to Techcentral.

As one of MTN’s three biggest markets, Nigeria is important for the mobile operator.

The Nigerian market accounts for 29 percent of MTN Group’s service revenue, 34 percent of the voice revenue and 30 percent of digital revenue, according to ITWebAfrica.

MTN is considering listing the company on the Uganda Stock Exchange as part of the conditions for it to renew its operating licence in the country.

Ugandan officials within the Uganda Communications Commission (UCC) have asked the South African operator to list some of its shares on the local bourse so that it may have its operating licence renewed, according to Techcentral.

Selling the shares in Uganda is not a strict precondition for the granting of a new 10-year contract at the moment, but the local regulator may add that as a condition. Before doing so, they have asked MTN to consider listing, giving Ugandans the opportunity to own part of the mobile operator through shares.

With their current licence expiring in October, they are under pressure to seriously consider the Uganda Stock Exchange listing.

MTN is the dominant mobile operator in Uganda with a market share of around 55 percent, representing 10.9 million customers in the country, according to ITWebAfrica.

The MTN Group has over 221 million customers in 22 markets across Africa and the Middle East.

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