MTN raises N125 billion for short-term working capital

Over N125 billion was raised by MTN Nigeria through the Commercial Paper Issuance Programme, the telecommunications company revealed on Wednesday.

MTN Nigeria said the firm’s initial fundraising expectation was N100 billion through Series 6 & 7 Commercial Paper issuance, however, it recorded 146 per cent subscription in the capital market.

The capital was raised under its N250 billion Commercial Paper Issuance Programme, which came to a close with the Series 6 & 7 issuance, a statement obtained from the Nigerian Exchange Limited disclosed.

The telecom giant said the Commercial Paper was utilised to diversify its funding sources and reduce its average cost of debt. The proceeds will be applied towards short-term working capital requirements.

“MTN Nigeria Communications PLC (MTN Nigeria) hereby notifies Nigerian Exchange Limited and the investing public of the successful completion of its Series 6 & 7 Commercial Paper issuance under its upsized N250 billion Commercial Paper Issuance Programme (the “CP Issuance”).

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“MTN Nigeria sought to raise N100 billion, and the offer recorded 146% subscription with N125 billion issued across both series. This represents the largest aggregate CP issuance within a calendar year by any corporate in Nigeria’s debt capital markets.

“MTN Nigeria issued 181-day commercial paper at a yield of 13.00% and 265-day commercial paper at a yield of 13.50%, with an issue date of 23 August 2023.

“The CP Issuance aligns with MTN Nigeria’s strategy to continue diversifying its funding sources and reducing its average cost of debt. The proceeds will be applied towards short-term working capital requirements,” the statement reads.

The telecom giant is Nigeria’s largest telecommunications company, and also became the first publicly listed company to hit the N2 trillion mark in revenues.

MTN first crossed one trillion naira in revenues in 2019 meaning it has taken the company just three years to surpass N2 trillion in revenues.