South Africa's MTN aims to settle Nigerian fine out of court, shares jump
- Wired World
- 12 Feb 2016 04:54 (South Africa)
JOHANNESBURG, Jan 22 (Reuters) - A judge has given South African telecoms company MTN Group until March to try to reach a settlement with the Nigerian authorities over a disputed $3.9 billion fine, sending its shares 8 percent higher.
The Nigerian Communications Commission (NCC) imposed the penalty on MTN last year for failing to disconnect users with unregistered SIM cards.
Nigeria has been trying to halt the widespread use of such SIM cards amid worries these are being used for criminal activity, including by the militant Islamist group Boko Haram.
MTN has been lobbying against the fine and has already seen it cut from an initial figure of $5.2 billion.
The judge at the Federal High Court in the Nigerian city of Lagos on Friday adjourned the case until March 18 to allow the parties to try to reach an agreement, MTN said in a statement.
The prospect of a lower fine boosted MTN shares.
Dobek Pater, the managing director of research group Africa Analysis, estimated that a fine that could satisfy both parties would between $1 and 2 billion.
MTN, which is led by Executive Chairman Phuthuma Nhleko makes about 37 percent of its revenue from Nigeria, and the current fine equates to more than twice its annual average capital spending over the past five years.
Nhleko was put in charge for up to six months in November to help to steer the company through the crisis.
The group is also fighting allegations for not paying tax in Cameroon.. (Reporting by Thekiso Anthony Lefifi; Editing by Keith Weir)