MTN shares surge on positive Nigeria news

21 September 2018

Mergers, Acquisitions and Financial Results

MTN Group’s shares rose the most in more than six months after the Nigerian central bank softened its stance over claims that Africa’s biggest wireless carrier illegally transferred US$8.1-billion out of the country.

The Central Bank of Nigeria made the accusation late last month, plunging the South African company into a crisis that’s wiped almost a third off its share price. MTN has since provided additional information that may lead to an “equitable resolution”, a spokesman for the authority, Isaac Okorafor, said in an e-mailed statement late on Wednesday.

Four banks — Standard Chartered, Citigroup, Stanbic IBTC and Diamond Bank — have also provided further detail on the transactions that will be reviewed by the central bank, Okorafor said. The quartet were fined about $16-million between them for enabling the allegedly improper transactions:”MTN can’t make a statement at this point as this would be purely speculative. However, we are actively engaging all parties concerned…”

The latest development suggests there may be a way for Johannesburg-based MTN to make a deal with Nigeria, just as the company did two years ago when it negotiated a $5.2-billion fine down to about $1-billion plus a commitment to list its local business in Lagos. However, that penalty — related to subscribers that weren’t properly registered in the country — also weighed heavily on the share price, which has yet to recover. Read the full article on Techcentral here.