Daily Watch – MTN considers pulling IPO, Air Peace boss says govt policies kill airlines

2nd October 2018

  • Brent crude, extended its gains on Monday, rising to its highest level of $84 per barrel since November 2014. The rise in oil prices came on the back of supply concerns before US sanctions against Iran come into force next month. Oil prices rose by 4.1 per cent in the third quarter of this year to $82.72 per barrel, the highest level in nearly four years. Meanwhile, Nigerian grades struggled to find buyers on Monday, Reuters quoted traders as saying. The Nigerian market was said to be struggling with an overhang of close to 20 unsold cargoes from the 58-strong October loading programme, while the November programme, the largest in six months, had seen fairly muted demand so far.
  • The MTN Group says it may no longer seek to raise capital through an initial public offering on Nigeria’s stock exchange. MTN is looking at other ways to trade the stock in Lagos, including a so-called introduction, in which existing shares are listed, Bloomberg quoted the company’s CFO, Ralph Mupita, as saying in an interview in Johannesburg. MTN’s board still needs to make a final decision, Mupita said. “The IPO type of listing has become challenging under current market conditions,” Mupita said. “We are exploring other options. The Nigerian business would not get fair value under current market conditions. A listing by introduction is the simplest way forward.” In the weeks after Nigerian authorities challenged the transfer of funds, MTN plunged 35 per cent, but the stock has since recovered about half of that drop.
  • Registration for the 2019 Independence Investment Forum, designed by the Nigerian-American Chamber of Commerce and Footprint to Africa to deepen trade relationship between Nigeria and the United States of America has started. The annual event billed for the 1st of October, next year is targeted at attracting long term investments into agriculture, power, energy, mining and commodities with focus on American investors and interested parties with presence across the globe. Oluwatoyin Akomolafe, said TIFF as part of efforts to drive impact in the business space, will beam international light on the vast resources and creativity in Nigeria through the programme.
  • The CEO of Air Peace, Allen Onyema, has told ThisDay newspaper that government policies are the reasons Nigerian airlines are not working well. “There is this talk that domestic airlines are not doing well. The owners of this business have succeeded in other businesses. So why are domestic airlines failing? The reasons should be found at the doorstep of government’s policies which have not been changed over time. We have been crying against excessive taxation. Air Peace is not up to four years old, the taxman has been knocking at my door every minute. In other countries, you are allowed a gestation period because you are providing hundreds of direct jobs, you are touching millions of lives.” The Air Peace boss commended President Muhammadu Buhari on the decision to suspend the national carrier project, and pointed out that other countries are running from owning national carriers.