MTN: 8,550 +2 (+0.02%)
MTN CEO confident about Nigeria dispute as firm applies for injunction
* MTN faces $10 bln penalties in dispute with Nigeria
* Nigerian unit brings in third of annual core profit
* Asks High Court to intervene while engaging government
(Adds Cwele comments, updates shares)
By Tiisetso Motsoeneng
DURBAN, South Africa, Sept 10 (Reuters) - South African
telecoms firm MTN Group said on Monday it was confident
a multibillion-dollar dispute with the Nigerian government would
be resolved even as it applied for a court injunction to protect
its Nigerian assets.
Nigeria's central bank last month ordered MTN's Lagos-based
unit to hand over $8.1 billion that it said was illegally sent
abroad, and the government this month handed MTN a $2 billion
Some industry analysts see Nigerian politics as a factor in
the pressure on MTN. President Muhammadu Buhari, who swept to
power in 2015 on promises to fight corruption and push through
tougher regulation, is seeking re-election in 2019.
"Nigeria, it's our largest market. We've been operating
there since 2001," MTN Chief Executive Rob Shuter told reporters
at the ITU Telecom World conference in Durban. "We do have some
challenges these past few weeks, but we believe we will be able
to make our case and I'm sure we will move past that as soon as
South Africa's Telecommunications Minister Siyabonga Cwele
said on the sidelines of the same conference that the government
was ready to intervene to help MTN resolve the dispute with
"If they need our assistance, then we will engage our
counterpart in Nigeria, but at this stage they have not asked us
intervene," Cwele told Reuters. "We will be waiting for their
Nigeria's main allegation against MTN is that it used
improperly issued certificates to convert shareholder loans in
its Nigerian unit to preference shares in 2007. As a result,
$8.1 billion in dividends paid by MTN Nigeria to its parent
between 2007 and 2015 should be returned, the central bank said.
Separately, Nigeria's Attorney General says MTN Nigeria
should have paid approximately $2 billion in taxes relating to
imports of foreign equipment and payments to foreign suppliers.
MTN's latest troubles come about two years after it agreed
to pay more than $1 billion to settle a dispute over SIM cards
in Nigeria, whose finances have been hit by a weak economy and
volatile global oil prices.
MTN, which has expanded in more than 20 frontier markets
including war-ravaged Syria and Afghanistan, denies wrongdoing
in Nigeria, which accounts for a third of its annual core
On Monday, it said in a statement that it had applied in
Nigeria's Federal High Court for an injunction to restrain the
central bank and Attorney General from taking further action
while it engages Nigerian authorities.
"We remain resolute that MTN Nigeria has not committed any
offences and will continue to vigorously defend its position,"
the statement read.
Shuter, who has led MTN since last year, said on Monday that
regulatory environments elsewhere in Africa and the Middle East
were largely aligned with what MTN wanted to achieve.
MTN's shares were weaker on Monday, trading down 0.9 percent
at 1600 GMT.
(Additional reporting by Nqobile Dludla
Writing by Alexander Winning;
Editing by Emelia Sithole-Matarise and Toby Chopra)
First Published: 2018-09-10 14:44:17
Updated 2018-09-10 18:19:49
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