Home Business Nigerian telcos delay listing as Ghanaian firms move ahead

Nigerian telcos delay listing as Ghanaian firms move ahead

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While Nigerian telecommunication firms push listing down the road, Ghanaian counterparts have taken concrete steps. MTN Ghana’s Initial Public Offer (IPO) is currently open. A maximum of 4,637,394,533 ordinary shares will be sold.

This comprises 2,489,698,667 new ordinary shares and a maximum of 2,147,695,867 already existing shares. The offer price is GHS0.75 (N56.49).

The listing was part of the conditions for obtaining a 4G licence.

Vodacom, Ghana’s third largest network is considering listing on the Ghanaian bourse, according to Reuters.

The Nigerian unit which had hitherto ssignalled its intentions to list this year has seemingly gone quiet, after much buzz. The company last stated it would list before the end of the year.

MTN agreed to the listing in June, 2016, as part of a $1 billion fine for missing a deadline to disconnect unregistered subscribers in the country. The penalty was originally set at $5.2 billion.

The listing has been eagerly anticipated as it would add an estimated N100 billion to the market capitalisation of the Nigerian Stock Exchange (NSE). The NSE has had a dearth of IPOs despite the stellar performance recorded last year.

IHS Towers Limited, which had planned an Initial Public Offer (IPO) on the New York Stock Exchange (NYSE) has shifted it till after Nigeria’s Presidential elections in February. MTN group owns a stake in the firm.

Foreign investors tend to suspend major investment decisions whenever elections approach. In the event of an upset, several policy changes occur.

Globacom and Airtel, the second and third largest operators have shown no indication in a listing. Globacom’s owner Mike Adenuga has key stakes in several listed entities including Julius Berger, Conoil Plc, and tier two lender Sterling Bank. Bharti Airtel, the parent company is listed on the National Stock Exchange of India.

Previous operators have fared badly

Telecommunication firms that were listed on the Nigerian Stock Exchange (NSE) largely performed badly. Starcomms, a CDMA operator was delisted from the exchange and investors failed to reap many benefits. The company eventually folded up and is owing billions of Naira.

IHS Nigeria Plc was founded in 2001 and listed on the NSE in 2009. In 2014, it was delisted.

Tough environment

Operators in the sector have been limited by several factors such as the volatility in exchange rate, illegal taxes levied by various tiers of government, and difficulty in getting right of way permits.

Weak economic growth has led to consumers cutting on airtime and data spending to focus on basic necessities.

Data released by the National Bureau of Statistics shows (GDP) growth rate for the quarter ending March, 2018, was 1.95%. This compares to a real GDP growth rate of 2.11% for the immediate past quarter ended December, 2017.




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