MTN agrees to fork out R25bn
MTN agrees to pay $1.7 billion to the Nigerian government to settle a record fine imposed by that country’s regulator.
|||Johannesburg - The MTN Group - Africa’s largest mobile operator by numbers - has agreed to pay $1.7 billion to the Nigerian government to settle a record fine imposed by that country’s regulator.
The multi-billion rand fine was imposed last year by the Nigerian Communications Commission after MTN failed to disconnect subscribers who had not registered their details with the operator.
The fine was initially $5.2 billion, but was then cut to $3.9 billion this year. MTN’s stock has lost about a third of its value since news of the fine became public.
Last month, Nigeria suspended talks with MTN about a record $3.9 billion fine while the House of Representatives completes an investigation into the size of the penalty and how it was delivered.
Read also: MTN: Fine won’t be repeated
MTN had, in March, proposed to pay $1.5 billion in cash and installments to settle it.
On Friday the company, which has more than 200 million subscribers in Africa and the Middle East, said its Nigerian unit would pay $1.671 billion at the official exchange rate “in full and final settlement of the matter”.
It noted this amount would be paid in six tranches, the last to be settled at the end of May 2019, but added payment was not an admission of guilt.
In addition to the settlement, the operator undertakes to take immediate steps to ensure the listing of its shares on the Nigerian Stock Exchange as soon as commercially and legally possible after the date of execution of the settlement agreement.
Read also: How MTN, an African success story, faltered
Group chairman Phuthuma Nhleko said he expresses his thanks and gratitude to the regulator for the spirit in which the matter was resolved and believes this is the best outcome for the company, its stakeholders, the regulator and the Nigerian people and that the relationship between MTN, the the regulator and the NCC has been restored and strengthened.
MTN did not indicate whether the fine would be paid from cash reserves or profit, nor how it would affect shareholders.
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