MTN Nigeria has announced that retail investors can purchase up to 575 million available shares at ₦169 per share starting from the 1st of December, 2021. The shares are going lower than their share price on the stock market and are a public offer that is being offered digitally. According to MTN Nigeria, the public offer come out of its commitment to cut down its shareholding in the country from 78.8 percent to 65 percent over time.
MTN Group’s Nigerian business was listed two years ago at ₦90 per share and has grown by about 100 percent since that time to become the second-largest stock by market capitalization.
Interested investors can purchase shares online; the process promises to be quick, convenient and stress-free. Speaking about the digital public offer, Bolaji Balogun, the CEO of investment banking firm Chapel Hill Denham in charge of the offering said in a statement that “The beauty of it being digital is that a lot more people can participate. The customer experience is a lot better; you can complete your purchase within 3-5 minutes. It also reduces the amount of paper that’s going to be used in printing share certificates. In all, we recognise that there are Nigerians who don’t have access to a smartphone or the internet, so they can go into any money deposit bank or a nearby MTN shop/agent to make more inquiries.”
The digital public offer is open starting December 1st through the 14th of December and will give Nigerian retail investors the rare opportunity to own shares in the company. The least amount of shares that can be purchased is 20 shares and as an incentive to encourage Nigerians to make more purchases, The company will issue an additional share for every 20 purchased. An investor, however, can only get a maximum of 250 free shares.
“There are five investment bank/issuing houses mandated to sell: Chapel Hill Denham (the led), Rand Merchant bank, Renaissance Capital, Vertiva, and Stanbic IBTC. In addition to this, all the (about 200) stock broking firms in Nigeria can sell. The primary authorised digital platform to buy from is PrimaryOffer, as seen on MTN’s site. Then there’s one other digital sub-broker, Chaka, which is partnering with Renaissance Capital”, Chapel Hill Denham’s Bolaji Balogun said stressing his belief that the digital sales of these shares will help increase financial literacy on stocks.
The announcement of the digital public offer has caused quite a stir. “In my 30 years of issuing shares, I’ve never seen this number of applications in the first few hours. People typically wait until the last few days to start buying. It shows that there’s a huge benefit in doing this digitally”, Bolaji Balogun said. MTN disclosed that if the 575 million ordinary shares are oversubscribed before the closing date, another 15%, which translates to 86 million more shares, would be offered to the public.
Following the announcement, MTN Nigeria’s share price fell 10 percent on Wednesday. According to experts, this is expected as investors scrambled to purchase the lower-priced MTN public offering shares.