MTN faces new Nigeria headache as local unit probed over listing

MTN’s Nigeria listing is being investigated by local authorities, the latest in a series of disputes in the wireless carrier’s largest market.

Nigeria’s Economic and Financial Crimes Commission (EFCC) has requested certain information and documentation regarding the May 16 listing, MTN Nigeria Communications said in a statement on Saturday. The carrier hasn’t been accused of wrongdoing and received all the necessary regulator approvals to start trading the stock, it added.

The company’s Lagos head office was raided by the financial crime agency on Friday in connection with the probe, according to a person with direct knowledge of the matter.

While Nigeria is central to MTN’s growth strategy and home to about 60 million of the company’s subscribers, a string of accusations and legal claims by various authorities have weighed on the carrier’s shares. The listing on the Nigerian Stock Exchange was itself a condition of a settlement reached with the telecommunications regulator in 2016 over the handling of customers without proper documentation, while MTN is also fighting a claim that it owes $2bn in back taxes.

Since the listing, MTN Nigeria’s stock has jumped 41%, closing at 140 naira per share on Friday, giving the company a market capitalisation of $7.8bn. That makes the firm the second-biggest listed company in Nigeria, behind only Dangote Cement.

The Lagos-based bourse said on May 21 that MTN Nigeria’s shares weren’t available for buyers and urged the company to provide more of the stock for investors. Parent company MTN plans to sell some of its majority stake at a later date.

MTN’s shares have declined 55% over the past four years in Johannesburg, largely as a result of Nigerian setbacks. The company is valued at R189bn ($13 billion).