MTN, Africa’s biggest wireless operator by sales, and minority shareholders in its Nigerian business are seeking to raise about $1 billion in an initial public offering, a condition tied to the settlement of a record fine imposed by the West African government, people familiar with the plan said.
Minority shareholders may sell down their holdings or exit entirely, while MTN may offer a small portion of its stake in the business, one of the people said, declining to be identified because the details are private. The Johannesburg-based company is still fine-tuning any offer and no final decision has been made on the amount, the people said. MTN declined to comment.
The IPO is part of a deal struck with the Nigerian government to pay a 330 billion naira ($1 billion) penalty for missing a deadline to disconnect unregistered subscribers. The negotiations over the fine, which has contributed to a 38 percent decline in MTN’s share price since it became public in October, cost R1.3 billion in professional-service fees, according to the company. Nigeria is MTN’s biggest money spinner, accounting for more than a third of its sales and profit.
MTN said in July that it hired Citigroup and Standard Bank Group as advisers on the transaction.