MTN has to deal with a 30% fall in its shares on news of another fine in Nigeria.
Last week, Nigerian tax authorities slapped Africa’s biggest mobile operator with a $2 billion fine for alleged unpaid taxes.
Last month, the Central Bank of Nigeria ordered MTN to pay $8.1 billion in dividends, which it claims MTN illegally sent abroad.
In 2015, the MTN Group faced a $5 billion fine in Nigeria for failing to disconnect unregistered subscribers.
The fine was subsequently reduced to R1.7 billion.
Co-portfolio manager at Lion of Africa Fund Managers, Liston Meintjies says, “I think the biggest problem any MTN shareholder has is how long this will last and what are we still doing in Nigeria, so the board of MTN has to try to solve or resolve that.”
“Now the problem they’ve got is that Nigeria is second only to South African in terms of the profitability to MTN, so it’s quite a significant amount of money that they would be walking away from in the future. But you have to weigh that up with $8 billion now,” adds Meintjies.
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