Airtel Nigeria’s planned listing will boost market performance – Analysts
Stockbrokers and analysts have described Airtel Nigeria’s plan to list its shares on the Nigerian Stock Exchange as a positive development following the listing of MTN on the bourse.
According to them, the trend will encourage other companies to consider going public.
They also said the trend would boost investor confidence and offer them investment choices.
The Chief Executive, Chartered Institute of Stockbrokers, Adedeji Ajadi, said the growing interest of telecom companies in the NSE would spur competition in the industry and in the stock market.
“I think it will be very positive for the market because Airtel is one of the companies that stakeholders in the market have been looking out for to be listed. These two coming at about the same time will be very good for the market,” Ajadi said.
“Generally, in terms of overall impact, that is what the market is looking out for – a variety of option for investors. Nigerian can also partake in the potential of these companies.”
The Managing Director, Afrinvest Securities Limited, Ayodeji Ebo, said the planned listing would generate more interest for potential companies, adding that the frequency of listing on the nation’s bourse and the type of company would ginger interest of companies in other sectors.
A capital market analyst, Rotimi Fakayejo, said investors and operator education was crucial.
“Both investors and operators need to know the modality for listing and secondly, the extent of disclosure they will give of their financials and also what the proceeds of the listing will be used for. It should be first by way of application to the Securities and Exchange Commission which I don’t believe has been done,” he added.
Bharti Airtel will be listing its Nigerian unit on the NSE as soon as it gets admitted to trade its shares on the London Stock Exchange.
As part of efforts to pay off its debts and expand its services in Africa, the telecom company has filed for an Initial Public Offering of its African subsidiary, Airtel Africa Limited, in London.
Bharti Airtel would be raising about $1bn from the sale of at least a 25 per cent stake in its African subsidiary that would be listed on the LSE.
“Immediately following admission (in the London Stock Exchange), the company intends to have a free float of at least 25 per cent of the company’s issued share capital and expects that it would be eligible for inclusion in the FTSE UK indices,” the company said in a press release on Tuesday.
“In addition, it is expected that up to a further 15 per cent of the offer will be made available pursuant to the over-allotment option.”
The planned listing of Airtel Nigeria on the NSE follows the successful listing by introduction of MTN shares on the premium board of the bourse as a condition for failing to disconnect 5.1 million unregistered SIM cards in Nigeria.
The Executive Vice Chairman, NCC, Prof. Umar Danbatta, had described the listing of MTN shares as a precedent and expressed optimism that other mobile network operators would follow suit.
“We triggered the listing of MTN on the NSE and MTN has complied. I remember issuing warning to MTN to ensure that they comply with the provision of the settlement agreement before May 2019,” the EVC said.
“Certainly, having set this precedence now, the stock exchange market is bullish through this listing. We hope all operators will follow suit. We hope they will do this when it is suitable for them to list because they have not committed any offence. Our hope is that all of them will subscribe to the listing of their shares on the stock exchange.”