MTN Still Seeking Resolution To Dispute With Nigeria

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MTN Nigeria
MTN Nigeria (Photo Credit: www.shutterstock.com)

MTN, Africa’s largest mobile phone operator, is still seeking an equitable resolution to an $8.1 billion dispute with the Nigerian authorities.

In September, the Central Bank of Nigeria (CBN) demanded $8,1 billion (R115 billion) allegedly paid as a dividend to MTN to be refunded to it.

The money was transferred by Standard Chartered, Stanbic IBTC Bank, Citibank and Diamond Bank.

Standard Chartered was fined 2.4-billion naira ($7.86m), Stanbic IBTC Bank 1.8-billion naira, Citibank 1.2-billion naira and Diamond Bank 250-million naira.

The government also handed MTN with a separate $2 billion tax bill.

The move resulted in MTN’s shares being hard hit by the news.

“Further to the cautionary announcement dated 30 August 2018 and the subsequent renewal of the cautionary announcements, the last of which was dated 29 October 2018, shareholders are advised that MTN Nigeria Communications Limited continues to engage with the Nigerian authorities in order to reach a mutually acceptable resolution on both the CBN and AGF (the Attorney General of the Federal Republic of Nigeria) matters,” MTN informed investors on Monday.

MTN CEO Rob Shuter told Reuters two months ago that the company was confident a multi-billion dollar dispute with the Nigerian government would be resolved even as it applied for a court injunction to protect its Nigerian assets.

“Nigeria, it’s our largest market. We’ve been operating there since 2001,” Shuter told reporters at the ITU Telecom World conference in Durban, two months ago. “We do have some challenges these past few weeks, but we believe we will be able to make our case and I’m sure we will move past that as soon as we can.”

The shares of MTN, which is valued at R162 billion, were trading 2.73% lower at R84.03 by 13:20 and the stock has dropped 25.7% in the past six months.

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