Lawmakers Promise To Compel MTN and Shell To List on Nigerian Stock Exchange in 2012

Federal lawmakers have promised that new legislation compelling Nigerian telecommunications operators such as MTN, as well as Oil and Gas majors including Shell to list on the Nigerian Stock Exchange will be complete in 2012.

The Chairman of the House Committee on Capital Markets and Institutions, Senator Herman Hembe promised that the legislation would be put before the house in a matter of days.

The Senator echoed the musings of CBN governor, Lamido Sanusi who had made similar statements at the recently concluded Nigeria Economic Summit.

To justify the position of the apex law body, the Senator provided facts on telecoms’ stating, “This sector, with a starting market of less than a million in 2000, now caters for over 90 million users. These telecommunications companies make huge profits from Nigeria and are mostly not listed on our market.

“MTN, for instance, got a license in 2001 for $285 million mostly financed by Nigerian banks. Between January and June of the same year, MTN repatriated some $5billion as profits from their Nigerian operations.”

He wondered why MTN would be listed on the Johannesburg Stock Exchange of South Africa, and not Nigeria since Nigeria accounts for a significant portion of the company’s annual turnover, further stating that, “The Nigerian group [of MTN] accounts for 25 per cent of the headline revenue of the MTN Group listed on the exchange. The story is not much different with the other telecoms operators in the country.

“Preliminary extrapolated figures indicate that the telecoms firms – MTN, Airtel, Glo and Etisalat- in terms of market capitalization could account for an average of N6.76 trillion　 (MTN –N2.4 trillion, Airtel-N1.55 trillion, Glo-N1.70 trillion and Etisalat N1.1 trillion) by Q2 2012, a figure far higher than the current market capitalization of N6.38 trillion as at November 22, 2011.”

The Senator also stated that the National Oil Company, popularly known as NNPC as well as other Oil and Gas majors will be compelled to list on the Exchange. Other categories of companies to be compelled to list include power generation and distribution companies, “once the process of their privatization is complete.”