MTN Group has announced its intention to cut its stake in MTN Nigeria from 76 percent to 65 percent through a public offer, reinforcing its commitment to bolster local ownership once the subsidiary’s fortunes improve.
During an editors’ roundtable meeting this week, Group President Ralph Mupita stated that this move, representing an 11-percent sell-down, was planned long in advance as part of a broader strategy to ensure more Nigerians have a stake in the company.
He noted that the proposed reduction would occur only after MTN Nigeria returns to profitability and resumes dividend payments, with shares currently trading at around 16 cents apiece.
This planned sell-down marks the second major public offer in Nigeria for the Group. In 2021, MTN sold 575 million shares to local investors, an oversubscribed transaction that ultimately allocated 661.25 million shares and brought its stake down from 78.8 percent to 75.6 percent. More than 126,000 investors, including sizable pension funds representing approximately 6.5 million contributors, participated in that sale. The Group had long pledged to reduce its stake to about 65 percent, and the recent announcement reiterates this strategic direction.
Despite reporting a rebound in revenue for 2024 with figures reaching US$2.23 billion, an increase of 36.03 percent from 2023 MTN Nigeria posted an after-tax loss of US$266 million, more than double its US$91 million loss in the previous year.
These challenges were attributed to severe economic headwinds, including soaring inflation and a sharp devaluation of the naira, which have driven up operational costs and squeezed investor returns. Consequently, MTN Nigeria has been surpassed by MTN South Africa as the Group’s largest revenue contributor.
Looking ahead, MTN Group is optimistic about a turnaround in 2025, attributing the expected recovery to recent tariff increases, operational restructuring, and an anticipated improvement in Nigeria’s broader economic environment. Mupita described the revival as “V-shaped,” emphasizing that structural reforms such as the removal of fuel subsidies, currency stabilization measures, and enhanced access to foreign exchange—are expected to boost operations and stimulate consumer spending.
The proposed stake reduction not only signals confidence in the subsidiary’s potential rebound but also reflects a broader commitment by MTN Group to localize ownership and empower Nigerian investors.
By reducing its stake to 65 percent, MTN aims to create a more balanced shareholding structure that could lead to better responsiveness to local market conditions. As the Group navigates Nigeria’s challenging economic landscape, its focus on both operational efficiency and deeper local integration stands as a key pillar in its strategy for sustainable growth.
