Telecom company hoping to raise $1 billion at IPO

folarin okunola

September 2, 2016 3:25 PM

Back in July, the South Africa-based telecom company announced that it had hired Citigroup and the Standard Bank Group as advisers on the IPO.

MTN Group's interim executive chairman Phuthuma Nhleko, file. REUTERS/Aladin Abdel Naby

MTN is reportedly looking to raise as much as $1 billion from its upcoming Initial Public Offering (IPO) - which is one of the conditions set in its fine settlement deal with the Nigeria Communications Commission (NCC).

According to Bloomberg, minority shareholders of MTN's stock may sell their holdings at a lower price or exit completely while MTN itself may also offer up a small portion of its stake.

The report says MTN is still fine-tuning the details of the IPO and no final decision has been made as at press time. However, MTN has declined to comment, the report says.

ALSO READ: South Africa's telecom giant reports $357 million loss, cuts dividend

Back in July, the South Africa-based telecom company announced that it had hired Citigroup and the Standard Bank Group as advisers on the IPO.

The IPO is an integral part of the deal which the telecom company struck with the Federal Government of Nigeria on its payment of a $.3 billion fine for failing to deactivate unregistered SIMs on its network.

The news of the fine and the subsequent negotiations ultimately led to a 38% decline in MTN's share price.

On the other hand, the Nigerian Stock Exchange (NSE) All Share Index has slumped 7% over the past year as the CBN continues to battle inflation and an all-time low in the value of the Naira.

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