MTN Nigeria has raised ₦75.18 billion through its commercial paper issuance, surpassing its initial target by 50%.
Aimed at strengthening the company’s working capital, this development was executed under MTN’s ₦250 billion commercial paper programme.
The Series 11 and 12 issuances, which were priced at 27.5% and 29% for the 181-day and 265-day tenors respectively, saw strong participation from institutional investors, including asset managers, banks, and insurance companies.
The issuance’s success is noteworthy given the challenging financial conditions and the temporary exclusion of pension funds, which had previously been active participants.
Despite this, the commercial paper saw a 150% subscription, reiterating investor confidence in MTN Nigeria’s ability to weather financial volatility.
The proceeds will be used to address short-term funding needs as the company scales through its working capital requirements.
MTN Nigeria has been having financial setbacks, including a huge loss after tax of ₦514.9 billion for the nine months ending September 2024.
This loss was attributed to the devaluation of the Nigerian naira and the subsequent foreign exchange losses, which led to a rise in finance costs.
However, the company has reported commendable growth in service revenue, which increased by 33.6% year-on-year, driven by a surge in data and fintech services.
Raising funds through this commercial paper issuance is part of MTN Nigeria’s goal to diversify its financing options, particularly in light of high interest rates and ongoing monetary policy adjustments.
This provides much-needed liquidity and enhances trust in the company’s long-term prospects despite the stressful economic challenges.
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