MTN Nigeria has proposed the issuance of up to N100 billion series 6&7 commercial paper notes to diversify its financing options.
This was disclosed via an official statement signed by Company Secretary, Uto Ukpanah to Nigeria Exchange Limited.
According to the statement, the issuance of commercial paper notes is part of MTN’s strategy to diversify its financing options, with the funds deployed towards working capital and general corporate purposes.
Here’s what the statement reads:
- MTN Nigeria Communications PLC (“MTN Nigeria” or the “Company”) hereby notifies the Nigerian Exchange Limited and the investing public of its proposed issuance of up to N100 billion Series 6 & 7 Commercial Paper notes under its Commercial Paper Issuance Programme (the “Issuance”).
- The Issuance is part of the Company’s strategy to diversify its financing options with the funds being deployed towards short-term working capital and funding requirements.
- Further details on the Issuance as well as subsequent issuances will be communicated to the market as the transactions occur.
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Commercial paper refers to a short-term, unsecured debt obligation that is issued by financial institutions and large corporations as an alternative to costlier methods of funding.
It is a money market instrument that generally comes with a maturity of up to 270 days.
The need for commercial paper often arises due to corporations facing a short-term need to cover expenses.
Meanwhile, MTN Nigeria had earlier released its 2023 Q2 results showing pre-tax profits fall by a whopping 64% to N44.6 billion.
This took its half-year profits to N200.3 billion compared to N268.6 billion same period in 2022.
Like most companies in Nigeria, MTN also suffered a foreign exchange loss of N131.4 billion which dragged profits down.
