MTN Nigeria Communications Plc has raised N100 billion in its debut commercial paper (CP) issuance, making history as the largest debut issuance by any Nigerian company.
MTN had planned initially to raise N50 billion under its registered N100 billion CP programme. However, the company recorded impressive oversubscription of 400 per cent and thus decided to increase the offer size to the maximum limit of N100 billion.
MTN Nigeria raised N20 billion under its series 1 180-day CP at an effective yield of 4.90 per cent. The telecommunication company raised N80 billion under its series 2 270-day CP at effective yield of 5.95 per cent.
Subscribers to the CPs included individual and institutional investors including pension fund administrators, asset managers, corporates and other financial institutions.
In a regulatory filing yesterday at the Nigerian Stock Exchange (NSE), MTN Nigeria stated that the level of subscription showed a strong investors’ confidence in the company’s ability to deliver on its strategic objectives and maintain market leadership.
Chief Executive Officer, MTN Nigeria Communications Plc, Mr Ferdinand Moolman said the new issuance allowed the company to broaden its sources of funding and combine capital market sources with established lines of credit, thus lowering its cost of borrowing.
He said the net proceeds will be used for the company’s working capital and general corporate purposes. The two series will be listed on the FMDQ Securities Exchange.