In its efforts to boost its operations in Nigeria, MTN Nigeria has announced plans to secure a seven-year medium term loan facility in conjunction with a consortium of eight banks in the country.
The announcement comes barely 48 hours after the formal confirmation of its listing by introduction as a publicly quoted company on the Nigerian Stock Exchange (NSE).
The N200 billion facility is the eighth syndicated loan agreement by MTN in Nigeria since it commenced operation in the country more than 18 years ago.
The company’ Secretary, Uto Ukpanah, in a statement disclosed the banks to include Access Bank, Guaranty Trust Bank, Zenith Bank, Fidelity Bank, First City Monument Bank, United Bank for Africa and First Bank of Nigeria.
Quantum Zenith was named as the facility agent while Citibank will act as coordinator.
The company said the agreement with the consortium of banks was signed at the law firm of Aluko & Oyebode in Ikoyi, Lagos.
The facility is structured with a two-year moratorium, a repayment plan of seven years and denominated in Naira.
Details of the medium term loan showed the facility would enable MTN to fund its evolving business opportunities by assisting its capital expenditure and working capital to deliver enhanced customer service.
In 2018, the telecoms company had secured a similar facility with a similar package which formed part of its wider programme to boost its domestic debt profile.
The latest company financial statement as at December 31, 2018 shows MTN Nigeria’s total outstanding loans at N175.3 billion.
Ferdi Moolman, Chief Executive Officer, MTN Nigeria, said the loan agreement with the banks “signposts MTN’s commitment to and confidence in Nigeria.”
He said the deal also shows the “strength of the strategic collaboration between MTN Nigeria and local financial institutions that will help deepen and broaden the provision of ICT services in Nigeria.”
He also explained that the facility expands MTN’s existing domestic debt programme, which the company is using to fund its increasing network expansion.
According to him, the debt programme has facilitated the expansion of its voice and data services on its networks to customers in new areas and with new next generation services.
“We (MTN) have enjoyed remarkable funding support from Nigeria’s financial institutions since our first facility in 2003. This has been critical to the development of one of the largest telecoms network in Africa, with over 60 million subscribers,” Mr Moolman said.
Moolman said the company was happy that after its successful listing on the NSE, MTN Nigeria was able to compliment it with an important addition to its portfolio of debt.
He said the participating financial institutions have showcased the strength of the Nigerian financial system and their confidence in the company’s vision to jointly stimulate significant economic growth.
The South African telecoms subsidiary was incorporated as a private limited company on November 8, 2000 MTN Nigeria Communications Limited.
With the confirmation of its listing by the NSE, the company re-registered as a public limited company in the name of MTN Nigeria Communications PLC effective April 18.