Monday, May 17, 2021

MTN Nigeria to tap debt market in first quarter – CFO

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Naija247news, Nigeriahttps://www.naija247news.com/
Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

ABUJA, March 10 – MTN Nigeria MTNN.LG plans to tap the debt market in the first quarter and has applied to the Nigerian Securities and Exchange Commission (SEC) for approval, its chief finance officer said on Wednesday.

Yields in Nigeria are at historic lows after the central bank cut rates twice last year to lower borrowing costs for the government, creating opportunities for firms to sell debt at more attractive rates.

Previously, the central bank had kept rates high with a view to attracting foreign investors to buy Nigerian bonds.

“There is an application with SEC. We are going to be tap the market to optimise our funding cost,” MTN Nigeria CFO Modupe Kadri told a call with analysts, without disclosing how much the company intended to raise.

The Nigerian division of South Africa’s telecoms firm MTN MTNJ.J said on Sunday its 2020 pretax profit rose to 298.9 billion naira and that it was at an advanced stage in renewing its operating licence, which is due to expire in August.

Kadri said a paucity of dollars in Nigeria was challenging but he hoped that as oil prices start to recover, dollar liquidity would improve. He said that dollar loans accounted for 6% of its total debt.

MTN Nigeria was looking to repatriate $250 million to $300 million in backlog dividends and had so far brought back about $20 million, Kadri said.

He said the ability of investors to bring funds into the country will help the naira.

The naira dropped on Wednesday to a low of 410.58 per dollar on the spot market, based on quotes from investors.

Asked about the outlook for growth, Kadri said: “What we have done is to put in place trade lines in excess of $180 million, backed by naira … at different terms to help finance capital expenditure.”

(Reporting by Chijioke Ohuocha; Editing by David Clarke)

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