MTN Nigeria Communications Plc has announced the successful completion of its Series 11 & 12 Commercial Paper (CP) issuance under its N250bn Commercial Paper Issuance Programme. Initially seeking to raise N50bn, the offering was oversubscribed by 150%, resulting in a total issuance of N75.18bn. This was disclosed in a notice to the Nigerian Exchange Limited (NGX) and the investing public.
The 181-day and 265-day CP were issued at yields of 27.50% and 29.00%, respectively, with an issue date of Thursday, November 7, 2024. The 265-day Series 12 CP was priced broadly at par with the 364-day Nigeria Treasury Bill instrument, which closed at a yield of 29.84% during the auction held on Wednesday, November 6, 2024. This yield was 384bps higher than the closing yield at the auction two weeks earlier.
This represents a well-timed transaction for the Company, as interest rates are expected to rise further following the auction’s outcome as monetary policy authorities continue to address interest and exchange rate pressures.
The oversubscription level further demonstrates the transaction’s success despite the absence of pension funds following the recent suspension of their participation in a commercial paper by the National Pension Commission pending the issuance of substantive guidelines by the Securities & Exchange Commission. The offer recorded participation from asset managers, banks, insurance companies and other qualified institutional investors.
The proceeds of the Issuance will be applied toward the Company’s short-term working capital requirements.
