MTN Shareholders Must See THIS Big Change!
If you have shares in MTN or an MTN shareholder, you need to listen to this. MTN announced an extraordinary general meeting for their shareholders on 21st May 2025. And there was a big change that every shareholder needs to know this. I'm sure you should have an email concerning this. And a lot of people don't understand what is in this email.
This is why I'm going to do a blog trying to explain exactly what the document is all about. You can find a document with a link in the description below or you can visit MTN's website to download the document. This circular is to shareholders explaining a big change MTN is making to localize its mobile money business to comply with the Ghanaian law.
So MTN mobile money which is also known as MML has to comply with some rules in Ghana. So you can see now MTN is not just about telecommunication. Now they've moved from telecommunication into finance. They have a system that they have mobile money limited and mobile money limited has to follow some guidelines according to the bank of Ghana.
Bank of Ghana has a law that requires at least 30% of any mobile money company in Ghana to be owned by Ghanaians. This law comes from the payment systems and services act 2019 act 987. Currently MTN Mobile Money is fully owned by foreign company which is MTN group from South Africa and Dubai. So they need to localize MTN by giving Ghanaians 30% ownership.
This is the law that they need to follow. So how is MTN solving this issue? The first phase was already done which is MTN worked to increase their Ghanaian shareholders through the Ghana stock exchange trading. By September 2024 about 32.13 of MTN Ghana was held by Ghanian shareholders. So you and I if you have a shareholder you are part of the 32% who is now owning MTN shares.
So that is the first phase. The second phase which is happening now MTN is now restructuring the mobile money business which is the MML to match the same Ghanian ownership requirement at the mobile money level. MTN Ghana is not just doing this they are following the steps. The first step is to create a new company called Newfinko.
The new company will replace MML which runs the mobile money. All assets, employees and operations of mobile money limited will now move to this new company. After moving the new company, they will have to set a trust. A trust will be created to hold shares in newfinko on behalf of Ghanian shareholders. What is actually a trust? A trust is a legal arrangement where one party who is called the truster or settler gives another party the trustee the right to hold and manage assets for the benefit of the third party.
We'll talk a lot more about a trust in my next blog. Now let's look at what is going to happen for the Ghanaian shareholders. So if you're Ghanaian shareholder in Scancom PLC which is MTN Ghana, your interest in the mobile money business will also be preserved through this trust.
So after everything is moved from mobile money to newfin mml will be dissolved which is mobile money will no longer be existing the newfo becomes the new official mobile money operator. So let's look at what happens after mobile money is transferred to newfin. So now the newfo is expected to be listed on the Ghana stock exchange in 3 to 5 years.
when it is listed, you will be able to directly trade shares in the newfo which is also separate from mobile money Ghana shares, right? It is going to be a different company where they're going to sell shares or they're going to you can actually trade your shares for um for your cash. So, let's look at how the ownership structure looks like after the change.
MTN Group, which is Invescom plus MTN Dubai, will hold 67.87% 87% of newfu which is the new company for mobile money. The trust which represent Ghanian shareholders will hold 32.13%. MTN also promises not to sell their new finko shares until it gets listed. So what is the key benefits for you as a shareholder? Number one is that your economic interest in Momo stays intact through this trust and you can still benefit from mobile money profits indirectly.
Also, when the new FINO gets listed, you will likely get direct shares and can also trade them just like you do for MTN Ghana shares. So, MTN is doing all this to make sure they comply with the Ghanaian law so it secures the future for Momo businesses. So what is going to be your cost and is there going to be some taxes that you need to pay? No, you don't have to pay anything.
MTN says the risk structure will be tax neutral. It won't lead to any extra tax for the company and all the cost will be shared by MTN, Skunkcom and the new company. So do you think that is what is affecting the share price of MTN right now? MTN share price is right now around 2.90 as I'm talking to you.
If you think that is what is affecting it, let me know in the comment section below. Are you holding MTN shares? Let me know in the comment section what do you think about this update. Don't forget to like and follow me here and make sure to subscribe to my YouTube channel for more updates like this. See you in my next blog.