The planned listing of MTN Nigeria on the Nigeria Stock Exchange (NSE) by second half (H2) 2019 has spurred Airtel Africa to also pursue listing and is likely to prompt other telecommunications operators to make the same move.
Airtel is said to have commenced talks with the Nigeria Communications Commission (NCC) for listing possibilities, after a high-powered delegation from Bharti Airtel Group including Paul Jaideep, Airtel group chief financial officer, Segun Ogunsanya, Airtel Nigeria CEO, and Oscar Onyema, NSE chief executive officer, visited the NCC headquarters in Abuja and held a closed door meeting with Umar Garba Danbatta, executive vice chairman, NCC. It is reported that two top officials of Stanbic IBTC were also in attendance at the said meeting.
Speaking on Airtel’s consideration of an IPO listing in the near future, Olusola Teniola, president, Association of Telecommunications Companies of Nigeria said the planned MTN listing is definitely a factor for Airtel’s consideration adding it was a good indicator as to where the industry would go.
“I feel that it doesn’t also stop with Airtel but a few other mobile network operators (MNOs) may be seeking the same path to show off their balance sheets, and one of the ways to continue to bring in the much-needed capital expenditure (CapEx) into the industry is through a capital structure that reflects a wider shareholder base,” Teniola said.
According to him, discussions in the past about whether the MNOs will list in Nigeria have been an ongoing story.
“We believe that the telecoms industry is now mature for other forms of funding, and listing on the stock exchange is one way to increase the CapEx needed to transform the telco businesses,” Teniola said.
Meanwhile, Rob Shutter, MTN Group’s CEO, in an exclusive interview with BusinessDay shortly after the telco’s financial result was published March 7, gave assurances of a listing before June 30, 2018.
“We have complied with the regulatory requirements for listing on the premium board. We already have the 20 percent minority in the company,” Shutter told BusinessDay.
MTN will be listing by introduction which will be followed by a public offer once market conditions are conducive.
Concerning Airtel’s listing, certain quarters have said that it would be by way of introduction, which means that the company shares would list without a prior Initial Public Offering.
While listing activity on the NSE remained relatively low in 2018 with one listing against four delistings, the coming to Custom Street market by MTN Nigeria for IPO was projected to open the doors for other telecommunications companies to approach the market for cheaper capital against a consortium of bank loans which puts pressure on them.
The listing of Nigerian unit of MTN Group and possibly Airtel will also help balance the Nigerian bourse and give investors options for sector rotation and reduce volatility associated with a single name dragging down the entire market.
BusinessDay contacted Emeka Opara, director of corporate communication, Airtel Nigeria, who said he was unable to comment on the company’s plans to list on the NSE.
Nigeria is the biggest market for Airtel in Africa, even though it is the third largest telco in the sub-Saharan country.
According to information on the NCC website, as at January 2019, Airtel has 44.97 million subscribers which represent 25.90 percent market share.
MTN has 66.67 million or 38.40 percent market share while Globacom, the country’s second largest telco, has 45.6 million or 26.27 percent.
Airtel’s parent company, Bharti Airtel Limited, is a leading global telecommunications company with operations in 16 countries across Asia and Africa.
With its headquarters in New Delhi, India, the company ranks amongst the top three mobile service providers globally in terms of subscribers.
In India, the company’s product offerings include 2G, 3G and 4G wireless services, mobile commerce, fixed line services, high-speed home broadband, DTH, enterprise services including national and international long distance services to carriers. In the rest of the geographies, it offers 2G, 3G, 4G wireless services and mobile commerce. Bharti Airtel had over 413 million customers across its operations at the end of March 2018.
Jumoke Akiyode-Lawanson & Segun Adams
