Following on from strong first-half 2022 results, MTN Group has announced the further deleveraging of their balance sheet with the early settlement of US$300million in Eurobonds with a 2024 maturity date.
This brings MTN’s dollar-denominated debt down to 35 percent of total holding company (Holdco) debt on a H1 2022 pro-forma basis.
In late August, MTN invited eligible holders of the US$750million Eurobond – due to mature in November 2024 – to tender their notes for purchase by the company for cash.
The offer attracted tenders of more than US$482million. This was significantly more than the US$250million originally intended for early settlement. As a result, MTN raised the final acceptance amount to US$300million, which will be settled on Tuesday 6 September 2022.
“In line with our Ambition 2025 strategy, we are committed to deleveraging the balance sheet faster in line with our capital allocation framework,” said MTN Group President and Chief Executive Officer Ralph Mupita. “This week’s early settlement supports delivery of this commitment, as well as the execution and delivery of our medium-term guidance to maintain the Holdco leverage below 1.5x.”
MTN Group Chief Financial Officer Tsholofelo Molefe said that as the settlement will be funded from available cash balances, it does not affect the pro-forma Holdco leverage of 0.8x at 30 June 2022. “However, on a pro-forma basis, the settlement improves the end-June 2022 ratio of non-rand to rand debt to 35:65 from the 42:58 ratio reported in the Group’s interim results.”
At end-December 2021, the Holdco leverage was 1.0x. The improvement in first-half 2022 to 0.8x was boosted by the repatriation of R9.4 billion in cash from our operating companies (including R4.5 billion from MTN Nigeria).
