MTN Nigeria Completes Its N100bn Commercial Paper

MTN Nigeria Communications (MTNN) Plc, Tuesday announced its successful issuance of N100 billion Series 1 & 2 Commercial Paper (CP) notes issuance programme.

Brandnewsday reports that MTN in a statement signed by the Company’s Secretary, Uto Ukpanah disclosed that the N100 billion issued was the largest debut CP issuance by a Nigerian corporate entity.

MTNN made this known in its statement notice to the Nigerian Stock Exchange (NSE) and the investing public.

MTN Nigeria Communications Plc. (CP 1) had a tenor of 180 days and 270 days (CP 2) with an effective yield of 4.90% for an N20 billion size (CP1) and 5.95% for an N80 billion size (CP2). The CP 1 & 2 notes will be listed on the FMDQ Exchange.

This is the largest commercial paper issuance recorded in Nigeria’s corporate history.

MTN stated that the Series I 180 day CP was priced at an effective yield of 4.90 per cent for an N20 billion size.

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The statement reads: ”Series II 270 day CP sizes at N80 billion, clears at an effective yield of 5.95 per cent.

“We initially set out to issue up to N50 billion under the N100 billion programme but, at the conclusion of the bank bookbuild, the CP issuance was 400 per cent subscribed.

“Given the significantly over-subscribed book, MTNN opted to issue up to the N100 billion limit of the registered CP programme.”

MTN Nigeria Acquires Its N100b Commercial Paper

The company disclosed that the CP experienced active participation from diverse eligible individual and institutional investors such as pension fund administrators, asset managers and corporates, among others.

“The level of interest in MTNN’s debut in the Nigerian debt markets is a strong reflection of investor confidence in its ability to continue to deliver on its strategic objectives,” the statement added.

In the statement, the company’s Chief Executive Officer, Ferdinand Moolman revealed that the N100 billion issued was the largest debut CP issuance by a Nigerian corporate entity.

Moolman said the CP would enable the company to broaden its sources of funding.

“It allows us to broaden our sources of funding and combines established lines of credit with access to capital market funding, which will lower our overall cost of borrowing.

“The proceeds from the issuance will be applied towards MTNN’s working capital and general corporate purposes.

“The Series I & II notes will be listed on the FMDQ Securities Exchange,” Moolman stated.