MTN shares were under renewed selling pressure on Monday morning amid a report out of Nigeria that the JSE-listed telecommunications group has agreed to pay a US$5,2bn (R72bn) fine imposed by the Nigerian Communications Commission.
Nigerian media outlet Vanguard reported on its website on Monday morning that MTN has “finally bowed to pressure as it has accepted to pay the 1,04 trillion naira fine”.
MTN is reportedly “pleading” for a staggered payment model, rather than having to pay the penalty all at once.
The report has sent MTN’s share price tumbling. It shed 6,2% to R148,01/share shortly after markets opened, before regaining some ground. It was last seen trading down by 3,7%. Last week, the share lost almost 20% of its value in three trading sessions after news emerged of the record-setting fine.
The Nigerian Communications Commission imposed the fine after MTN allegedly failed to deactivate 5,1m Sim cards to comply with a deadline. The commission has taken a hardline approach in ensuring unregistered Sims are disconnected. The regulations are meant to crack down on crime and terrorism, a major problem in the West African nation.
According to Vanguard, MTN has agreed to pay the fine following a series of meetings between the operator’s management team and Nigeria’s vice-president, Yemi Osinbajo.
The report said MTN wanted a waiver, which was rejected. “Instead, I think there will be concession, but certainly not a waiver,” the publication quoted a source as saying.