MTN Confirms Plans To Sell 14% Of Its Nigerian Business Despite Double-digit Growth

MTN Group based in Nigeria sets to lose 14% of its investment due to the unfavourable market condition in Nigeria, Techbooky writes. MTN’s shareholders agreed to sell their shares — a recoverable asset over the medium term.

MTN shareholders confirmed they agreed to terms that demanded them to sell their shares which explains the reason why their Nigerian business experienced double-digit growth.

For context, the service the telecom giant offers increased its revenue by 24.1% which is equivalent to N790.3 bn. This explains the double-digit growth MTN Nigeria experienced — business sales increased by double-digit during the holidays.

Remember, MTNNigeria predicted a favourable business year whereby the expected revenue will bolster the ownership of the telecom giant while it diversifies its shareholders with multiple institutional investors.

It is worth noting that voice and data revenue increased MTN Nigeria’s business exceedingly. Voice revenue gained 31.1% which is equivalent to N413.5 bn. While data revenue gained 48.3% which is equivalent to N228.5 bn.

MTN Nigeria once revealed its unaudited results for the half-year ended — they predicted to earn up to 24.1% which is equivalent to N790.3 bn. Although MTN Nigeria data sector has reportedly gained 80.3% year-over-year revenue.

“In the first half of 2021, MTN’s 4G network now covers 65.1% of the population, up from 60.1% in December 2020,” in line with MTN Nigerian’s chief executive, Karl Toriola — despite the massive traffic on voice and data usage, its number of users have reportedly dipped.

Since regulators demand Telecom operators to pause SIM activation while SIM sales are restricted — this order was issued to bolster the NIN activation exercise. The number of MTN active users has numbered 68.9 million subscribers — analysis based on the first quarter of MTN business year.

The telecom giant also increased the cost of its product service by 24.6% due to the unfavourable condition of the Nigerian economy — the cost of MTN services expense increased by N374 bn. Aside from the depreciated value of Naira, because of the COVID-19 outbreak that restricted services distribution.

“We have a clear focus on sustaining double-digit service revenue growth ahead of inflation, driving 4G and rural network expansion.” MTN Nigeria revealed its increment in revenue is bolstered by the surge in the digital economy that is expected to “position MTN Nigeria fintech and digital businesses for accelerated growth in order to unlock their full value”

However, regulators have retracted the restrictions they issued in SIM activation — MTN Nigeria outlets nationwide have certified stations expected to continue with it accrediting new subscribers.

While MTN Nigeria’s business was audited, its shareholders approved N4.55 kobo per share to all shareholding members in line with the telecom interim dividend that reportedly grew by 30%.