MTN Group\u2019s long-discussed plan to reduce its shareholding in MTN Nigeria is no longer on an immediate timeline. While the Nigerian unit has returned to profitability and resumed dividend payments,\u00a0 shifting tax dynamics have complicated the path to a public sell-down.<\/p>\n
Speaking during the company\u2019s Q3 2025 earnings call<\/a> in November, MTN Group president and CEO Ralph Mupita suggested that recent changes to Nigeria\u2019s capital gains tax (CGT) regime have made a near-term reduction in the Group\u2019s stake commercially unattractive. As a result, plans to dilute ownership in favour of local investors are effectively on pause.<\/p>\n \u201cThat has been complicated by the changes in the tax code,\u201d Mupita said, according to transcripts released in December. \u201cThere have been some changes to CGT; right now, it is not something that we are pushing at. We kind of pulled back and are holding back. We didn\u2019t put a hard timeline on ourselves, but with the developments on the tax codes, it\u2019s made it a bit unattractive for us to do it right now, so we\u2019re kind of paused on that initiative, primarily driven by the changes in the tax code on capital gains.\u201d<\/p>\n The pause marks a shift from the telco giant\u2019s long-stated plan to deepen local ownership of its Nigerian business once it returned to profitability. While the company has cleared key financial hurdles, the higher CGT rate has altered the economics of large share sales, reinforcing investor concerns that the new tax regime could slow major capital market transactions.<\/p>\n MTN Group did respond to a request for comments at the time of publication.<\/p>\n As part of recent tax reforms, Nigeria raised capital gains tax for companies from 10% to 30%, increasing the cost of large equity transactions. CGT<\/a> applies to profits realised from the sale of shares and other equity securities and was raised to curb tax arbitrage between trading income and chargeable gains.<\/p>\n For CGT to apply<\/a>, share transactions must exceed \u20a6150million ($105,763.40), with gains above \u20a610million ($7,050.89).<\/p>\n The tax shift comes at a time when MTN Nigeria has returned to profitability and resumed dividend payments, clearing key conditions that previously delayed the sell-down. The Nigerian unit posted a \u20a6750.19 billion ($528.95 million) profit for the nine months ending September 2025<\/a>, from a \u20a6514.9 billion ($363.05 million) loss in the same period last year, and declared an interim dividend of \u20a65 per share.<\/p>\n MTN Nigeria\u2019s shares were trading at \u20a6573.90 per share<\/a> as of Monday, January 12, 2026. MTN Group is expected to receive a gross dividend of about 975 million rand ($59.19 million) from its Nigerian subsidiary.<\/p>\n MTN Group has long said it intends to deepen local ownership of its Nigerian business. In April 2025<\/a>, Mupita reiterated plans to cut the Group\u2019s stake once MTN Nigeria resolved its negative equity position and resumed dividend payments. That commitment forms part of MTN\u2019s localisation agreements with the Nigerian government<\/a> following its 2016 settlement over unregistered SIM cards.<\/p>\n \u201cThe only localisation we have as MTN Group is we have a potential sell-down in Nigeria at some point in time, approximately 11%,\u201d Mupitan said at the time. \u201cThis is something we have said long ago, that over time we would want more Nigerians owning the company, and we are prepared to sell down to 65%. We are at around 76%.\u201d<\/p>\n The proposed transaction would mark MTN\u2019s second major retail public offering in Nigeria, following its 2021 sale of MTN Nigeria shares to local investors<\/a>. That offer was oversubscribed, with 661.25 million shares allocated, including a 15% greenshoe option, reducing MTN Group\u2019s stake to 75.6% from 78.8%. More than 126,000 investors participated, including Nigerian pension funds representing approximately 6.5 million contributors.<\/p>\n Market analysts emphasise that the higher rate has made transactions of this scale more expensive. Nigeria\u2019s CGT rate exceeds those of several peer markets, including the United States (21%), South Africa (21.6%), and Kenya (15%)<\/a>.<\/p>\n