MTN Nigeria N100bn Commercial Paper Issuance Unveiled Today

MTN Nigeria N100bn Commercial Paper Issuance Unveiled Today
Telecoms giant, MTN Nigeria has announced the opening of its Commercial Paper (CP) Issuance, a two-part series (180 days & 270 days commitment of N50 billion each) totalling N100 billion issuance today.
 The Offer is scheduled to close on Thursday, June 4, 2020.
For those who don’t know what commercial paper means, A Commercial Paper or CP for short is a money-market security issued (sold) by large corporations to obtain funds to meet short-term debt obligations (for example, payroll) and is backed only by an issuing bank or the company’s promise to pay the face amount on the maturity date specified on the note.
According to an email sent on behalf of the company today, proceeds from the CP Issuance will be used to support MTN Nigeria’s working capital and for other general corporate purposes. The issuance is being managed by Chapel Hill Denham Advisory Limited.
This issuance under the CP Programme represents MTN Nigeria’s debut in the domestic debt capital market since listing. Checkout the statistics below for a summary of the details:
MTN Nigeria Opens N100bn Commercial Paper Issuance Today
MTN NG is rated Aa+ by Agusto & Co. which reflects the Company’s history of strong financial performance…
The CP Registration will be closed from November 25, 2020, until the Maturity Date. The 180 days (commercial paper 1) issuance has an implied Yield of 4.8% – 5% while the 270days (commercial paper 2) offers a 5.85% – 6% implied Yield.
All indices point to the fact that the company has all it takes to pull off that volume of credit without faltering.
Recall that MTN Nigeria displaced Dangote Cement as the most capitalised company on the Nigerian exchange just three months after MTN listed its shares on the Nigerian Stock Exchange. The telco company’s stock gained 2.74 per cent to become N138.70 thereby bringing its market value to N2.82 trillion as against Dangote Cement 2.81 trillion.
A look at how the CBN Sanction May Affect the Expected MTN Listing
MTN remains Nigeria’s largest telecom provider. Its 2019 financial report shows that the company’s total number of mobile subscribers increased by 6.1 million. Its total mobile subscribers currently stand at a record 64.3 million. This represents a 10.5% net growth from the numbers recorded in the previous year.
The company has recorded over N1 trillion in revenue for the second year in a row. It also generated revenue of N1.2 trillion, which is a 12.57% increase from the N1.039 trillion generated in 2018.
The commercial Paper is the telcom networks intervention on the capital market in Nigeria. It aims to provide aid for domestic debt through the issuance.