Nigeria raises MTN fine to $3.9bn
MTN says Nigerian authorities raised the penalty to $3.9 billion - 24 hours after the telecommunications regulator had cut the fine to $3.4 billion.
|||Johannesburg - MTN Group said Nigerian authorities raised the penalty Africa’s largest mobile-phone operator must pay to $3.9 billion - 24 hours after the telecommunications regulator had cut the fine to $3.4 billion. The shares fell for a second consecutive day.
The Nigerian Communications Commission increased the amount in a letter dated Thursday, the Johannesburg-based company said in a statement on Friday. It had reduced the initial penalty of $5.2 billion by 35 percent to $3.4 billion in a December 2 note. The amended figure, which supersedes the previous fine, is 25 percent less than the original amount. The payment date remains December 31, MTN said.
MTN shares dropped 5.2 percent to R132.75 as of 9:37 a.m. in Johannesburg, the lowest since November 17. The stock has fallen 9.5 percent across two sessions, extending the decline since the fine was made public in October to 30 percent.
The regulator imposed the penalty on MTN for failing to meet a deadline to disconnect 5.1 million unregistered subscribers.
Chairman Phuthuma Nhleko took an executive position in November and led negotiations with the NCC after CEO Sifiso Dabengwa resigned. The initial fine of $5.2 billion was more than MTN’s total sales in Nigeria in 2014 and the equivalent of about 37 percent of all the group’s revenue.
“Neither the first letter nor the second letter sets out any details on how the reduction was determined,” MTN said. The company is carefully considering both letters, and Nhleko “will immediately and urgently re-engage with the Nigerian authorities before responding formally,” it said.
MTN is working to further reduce a the fine, a person familiar with the matter said on Thursday.
BLOOMBERG