MTN: 8,685 0 (0.00%)
MTN faces possible Moody's downgrade after Nigeria's cash demands
JOHANNESBURG, Sept 6 (Reuters) - MTN Group was
under review by Moody's for a possible credit rating downgrade
after the South African mobile phone operator said it was being
asked to pay a total of $10.1 billion by authorities in Nigeria,
the ratings agency said on Thursday.
Africa's biggest wireless phones group said on Tuesday the
Nigerian Attorney General (NAG) was seeking $2 billion in taxes
incurred over the last decade, days after an order from the
Central Bank of Nigeria (CBN) that MTN's Lagos-based unit hand
over $8.1 billion that it said was illegally sent abroad.
"MTN's ratings have been placed on review for downgrade to
reflect the uncertainty around the potential implications of the
recent CBN and NAG announcements on MTN's credit profile,"
MTN, whose debt stands at around 57 billion rand ($3.7
billion), has said the CBN's allegations are without merit and
it would hold talks with authorities to defend its position.
Moody's, which already has junk rating on MTN debt at Ba1,
said without the demand for the refund and the potential tax
shortfall MTN would be able to repay approaching debt maturities
over the next 12 to 18 months.
($1 = 15.2782 rand)
(Reporting by Tiisetso Motsoeneng
Editing by James Macharia and Elaine Hardcastle)
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