MTN Confirms EFCC Probe, Denies Shares Manipulation


• Share price drops

Emma Okonji

MTN Nigeria Communications Plc has confirmed the visit of the Economic and Financial Crimes Commission (EFCC) to its Falomo office in Ikoyi, Lagos, to probe an alleged shares manipulation scandal rocking the telecoms company since the recent listing of its shares on the Nigerian Stock Exchange (NSE).

The development may have contributed to the depreciation in the share price of MTN Nigeria for the first time since it was listed on the Nigerian bourse.

Precisely, after appreciating by 65 per cent (N59) in just one week, from the N90 per share it was listed on the NSE, to N149 per share last Thursday, MTN Nigeria’s share price suffered its first decline last Friday as it closed at N140 per share.

THISDAY had reported that SEC recently launched a probe into the process that led to the listing of MTN Nigeria on the NSE, even though the exchange had defended the telco.

But in a statement signed its company Secretary, Uto Ukpanah, which was obtained yesterday, MTN said it was never accused of any wrongdoing by the EFCC.

THISDAY had reported that the anti-graft agency stormed MTN’s office about 4pm on Friday and quizzed top officials of the telecoms company after demanding vital documents, which they were promptly given.

THISDAY also learnt that the EFCC visit and questioning of MTN management staff were not unconnected with the alleged shares manipulation in the recent MTN listing on the NSE.

According to the statement by Ukpanah, “MTN Nigeria Communications Plc (MTN Nigeria) received a letter on May 23, 2019 from the Economic and Financial Crimes Commission (EFCC) requesting information and documentation related to the listing of our shares on the Nigerian Stock Exchange (NSE). MTN Nigeria has not been accused of any wrongdoing by the EFCC.

“We wish to reiterate that we received all regulatory approvals required to list our shares on the Nigerian Stock Exchange, as publicly confirmed by the Nigerian Stock Exchange and the Securities and Exchange Commission (SEC).

“As a law-abiding and responsible corporate citizen, we are cooperating fully with the authorities. We are committed to good governance and to abiding by the extant laws of the Federal Republic of Nigeria.”

MTN had on May 16 listed its shares on the NSE by way of an introductory listing. The listing by introduction meant that the shares of existing MTN Nigeria shareholders were listed without an additional public sale of shares. By this development, all MTN Nigeria shareholders were free to trade their shares on the NSE.

But few hours after the listing, investors and stakeholders were worried about the free float accommodation MTN Nigeria Communications Plc was granted by the capital market regulator to pave the way for its listing. They suspected that the MTN shares must have been manipulated to drive the price of the stock high before any share offering through an Initial Public Offering (IPO).

THISDAY had also reported that investors on the NSE and stakeholders waiting to purchase MTN shares through an initial public offering might do so at a very high premium whenever the telco decides to float the IPO.

This was because of the free float accommodation and some other waivers MTN Nigeria was granted by the capital market regulators to pave the way for its listing last Thursday.

But despite the perceived manipulation of the MTN shares, the telecoms industry regulator, the Nigerian Communications Commission (NCC), has declared confidence in the listing of MTN Nigeria shares. Executive Vice Chairman of NCC, Professor Umar Garba Danbatta, said recently that with MTN shares available in the capital market, Nigerians would buy shares and by purchasing the shares of MTN, they would be financially empowered and socially transformed.

“Through the MTN listing on the NSE, the Commission had translated into action an important function of the Commission, which is to promote local investment and ownership in the telecom sector,” Danbatta had said.