MTN gets deadline extension for payment of $5.2 billion fine

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South African telecoms giant MTN has won a respite on the payment of a massive $5.2 billion fine imposed on the company in Nigeria to allow for negotiations, the mobile phone operator said Monday.

The Nigerian Communications Commission (NCC) slapped the penalty on Africa’s largest telecoms firm for failing to deactivate 5.1 million unregistered SIM cards, sending its share price plummeting and leading to the resignation of chief executive Sifiso Dabengwa.

The deadline for the fine to be paid was November 16, but the company announced that the NCC had agreed that it will not be payable until the end of negotiations entered into by acting executive chairman Phuthuma Nhleko, who has taken on Dabengwa’s role for six months.

“Shareholders are advised that the executive chairman of the company, Mr Phuthuma Nhleko, has personally met with the Nigerian authorities to continue the ongoing discussions with them regarding the fine,” the statement said.

“These discussions include matters of non-compliance and the remedial measures that may have to be adopted to address this.

“Shareholders are advised that the Nigerian authorities have, without prejudice, agreed that the imposed fine will not be payable until the negotiations have been concluded.”

Nigeria, Africa’s most populous country, is MTN group’s largest market where it had over 62.8 million subscribers by the second quarter of this year.

The Johannesburg Stock Exchange (JSE) has launched an investigation into MTN for “possible insider trading” before the company announced it had been hit by the fine.

The probe could result in South Africa’s bourse operator slapping MTN with another hefty penalty or result in criminal charges.

Source: TheGuardian