MTN plans Nigeria IPO after $2bn tax issue is resolved

MTN plans Nigeria IPO after $2bn tax issue is resolved
Source: Bloomberg
Date: 13-03-2019 Time: 03:03:57:pm

MTN Group Ltd plans to push ahead with an initial public offering of its Nigeria unit in April or May once Africa’s biggest wireless carrier resolves a $2 billion tax dispute in the country.

When the tax matter has been settled, “the board can assign a value to the company and we do an IPO,” spokesman Tobe Okigbo told reporters in Lagos on Wednesday. “It is difficult to put a value on it when there is such an issue.”

Nigeria’s Attorney General accused Johannesburg-based MTN of not paying all its taxes in September, and the two sides have yet to reach an agreement.

A court hearing on the matter is scheduled in the country’s commercial capital for March 26. The dispute has cast doubt on MTN’s long-held plans to list the local unit -- part of a deal to resolve a separate regulatory tussle in 2016.

While the tax and IPO issues rumble on, MTN has received a permit to start mobile-banking in Nigeria, the biggest of its 20 markets around Africa and the Middle East.

Financial services is a key growth market for the carrier due to a scarcity of banks in many parts of the continent and rising takeup of smartphones and data services.

MTN will start selling a new smartphone in Nigeria that costs about 18,000 naira ($49.72), which the company sees as a way of increasing data revenue, according to Ferdi Moolman, the Nigerian unit’s CEO.

MTN shares rose 0.3 percent to 95.21 rand as of 3:37 p.m. in Johannesburg, the fifth consecutive day of gains since it announced a 15-billion rand disposal plan last week. That included online retailer Jumia Technologies AG, in which MTN is the biggest shareholder, which announced IPO plans in New York on Tuesday.

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