MTN Pays Former CEO N350m As Exit Package
Mr. Michael Ikpoki, former MTN Nigeria chief executive officer, has received about $1.8 million (N350 million) as exit package which includes his salary and post-employment benefits after his resignation in early December last year.
This development is part of the cost of MTN’s non-compliance in Nigeria, and massive exit of some of the executives who left in the midst of the ongoing mega-fine scandal.
Ikpoki’s exit came after MTN revealed it was facing a $5.2 billion fine in Nigeria for failing to disconnect 5.1 million subscribers in the country, by the Nigerian Communication Commission’s (NCC) deadline.
This was later reduced by 25 per cent but MTN still faces a $3.9 billion fine from the NCC, which is yet to be resolved six months later. How much of the fine will ultimately be paid is still unknown, but the costs associated with the non-compliance issue are racking up for the telco.
There is no statement as to how much Akinwale Goodluck, former Nigerian head of regulatory and corporate affairs, received for his exit. Goodluck resigned at the same time as Ikpoki.
In terms of the actual fine, MTN has so far, only paid Nigerian authorities $250 million as part of a “good faith payment” towards settling the hefty fine in the West African nation. The company also included a provision of almost R9.3 billion for the fine in its 2015 full-year results.
Overall, in 2015, MTN paid its more than 21,000 employees a total of R8.6 billion. Around 15,000 of these employees are permanent, while the rest are contractors.
The number of people in the business declined five per cent from 2014. The company also revealed that only 37 per cent of MTN’s staff are women.
The total amount paid to non-executive directors was around R21.5 million, compared to around R14.7 million in 2014. In 2015, MTN paid almost R3.7 billion in regulatory fees across its 22 operations; R19.1 billion was paid for licences and R13.5 billion in taxes.
MTN admits in the integrated report that the Nigerian fine has “eroded investor confidence in MTN Nigeria and the group as a whole, and negatively impacted the reputation of MTN across our stakeholder groups”.
The total of the MTN fine in Nigeria is still up for negotiation and the telco stated it continues to engage with the Nigerian authorities to “ensure an amicable resolution in the best interests of the company, its stakeholders and the Nigerian authorities”.
Source: Footprint2Africa 5 May 2016