MTN Nigeria converts to Plc so as to list on the Nigerian Stock Exchange
MTN Nigeria recently announced its conversion from a Private company (Ltd) to a Public Limited Company (Plc). In a statement released on Wednesday April 24 2019; the telecom company, now MTN Nigeria Communications Plc gave reason for its conversion as being a legal requirement and key milestone for its listing on the Nigerian Stock Exchange (NSE).
According to the statement, listing on the NSE will help create a new telecoms asset class for investors. It will also provide a wider group of Nigerians with a chance to invest in MTN.
According to the CEO MTN Nigeria Plc, Mr. Fendi Moolman, in addition to providing everyday services to Nigerians; there is also a long-term commitment by the company in expanding its investment opportunities.
— MTN Nigeria (@MTNNG) April 24, 2019
This move to become a Plc is also part of the company’s response to an agreement it signed with the Nigerian Communications Commission (NCC) in 2015. In 2015 due to MTN’s failure to deactivate millions of unregistered sims; it was fined a ₦1 trillion. However, after negotiations the fine reduced to ₦330 billion and the listing of its Nigerian subsidiary (MTN Nigeria) on the Nigerian Stock Exchange.
MTN Nigeria Communications Plc have however not started the process for its Initial Public Offering (IPO), but we look forward to that.
Differences between private company and public limited company.
- Private companies have limited means of raising funds and cannot sell shares on the stock market. But public companies (Plc) can raise funds from a variety of investors; and can also list on the stock market as a publicly traded company.
- Private companies are under no legal requirement to reveal financial information to none shareholders. While public companies are regulated by the Securities and Exchange Commission (SEC) and they must adhere to regulations and reporting standards.