Yesterday it was reported that the fine issued by the Nigerian Communications Commission (NCC) to MTN had been reduced to R46.4 billion from R72.2 billion. A superseding letter sent to the operator by the NCC late yesterday afternoon however, has increased that fine to R56.1 billion.
A statement sent to MTN shareholders early this morning explains that the NCC had actually intended to reduced the fine by 25% and not 35% as the first letter, received on 2nd December, had stipulated. The payment deadline set for 31st December remains.
Similarly to the original letter, MTN will issue a response once both the original and updated letters have been reviewed. The statement to shareholders reads, “The Company is carefully considering both the First Letter and the Second Letter, and the Executive Chairman Phuthuma Nhleko will immediately and urgently re-engage with the Nigerian Authorities before responding formally”.
MTN did state that neither the first, nor the second letter outlined details about how the reduced amount was determined. Shareholders have also been warned to “…exercise caution when dealing in the Company’s securities until a further announcement is made”.
Since the fine was issued in October, the MTN share price has fallen from a peak of R190.84 to R140.00 at closing yesterday. With such a drop in value, the question is where will MTN find the money to pay the Nigerian commission?
[Image CC by 2.0 – Warren Rohner]