By Juliet Umeh
Provider of communication services, MTN Nigeria, said it has become the first Nigerian firm to successfully issue N100 billion limit of the registered commercial paper, CP, Programme.
Notifying the Nigerian Stock Exchange, NSE and the investing public on the issuance of N100 billion Series I & II Notes under the debut N100 Billion CP, the company said it priced the Series I 180 day CP at an effective yield of 4.90
percent for a N20 billion size and the Series II 270 day CP sized at N80 billion cleared at an effective yield of 5.95 percent.
The company also explained that it initially set out to issue up to N50 billion under the N100 billion CP Programme but, at the conclusion of the book build; the CP Issuance was c.400 percent subscribed.
MTN said: “Given the significantly over-subscribed book, we opted to issue up to the N100 billion limit of the registered CP Programme, with active participation from a diverse orbit of eligible individual and institutional investors, which include pension fund administrators, asset managers, corporates and other financial institutions.
“The level of interest in MTN Nigeria’s debut in the Nigerian Debt Markets (as measured by the volume and value of bids), is a strong reflection of investor confidence in MTN Nigeria’s ability to continue to deliver on its strategic objectives and maintain market leadership, as well as the strong credit profile that supports the Company’s ability to meet its debt service obligations,” the company added.
Chief Executive Officer, Ferdinand Moolman, said: “The N100 Billion issued is the largest debut Commercial Paper issuance by a Nigerian corporate. It allows us to broaden our sources of funding and combines our established lines of credit with access to capital market funding, which will lower our overall cost of borrowing.”
According to the company, the proceeds from the CP Issuance will be applied towards MTN Nigeria’s working capital and general corporate purposes. The Series I & II Notes will be listed on the FMDQ Securities Exchange.