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JOHANNESBURG — The way that Nigeria’s authorities are handling the claim that MTN allegedly illegally transferred $8.1bn out of the country is starting to look more like a haggle in a Lagos marketplace rather than a serious business and regulatory discussion. If any investors had any reservations about going into Nigeria, the MTN saga would be at risk of turning them off completely from the West African country. Seeing as Nigeria is MTN’s biggest market, the mobile network also needs to handle this situation with utmost care, even though it must surely be frustratingly. – Gareth van Zyl
By Simon Kennedy
(Bloomberg) – MTN Group Ltd. and its bankers have provided more documents that may reduce Nigeria’s $8.1 billion claim on the South African wireless carrier, which could be resolved soon, Central Bank of Nigeria Governor Godwin Emefiele said.
The central bank alleged in late August that MTN and four banks – Standard Chartered Plc, Citigroup Inc., Stanbic IBTC Plc and Diamond Bank Plc – illegally repatriated money from Nigeria and that the company should return $8.1 billion. The local regulator also fined the four banks a combined $16 million.
Speaking to reporters in London on Sunday, Emefiele said he expected that the new information would help cut the size of the claim and that the matter would be resolved “amicably.”
“I don’t think it will be at $8.1 billion having provided documents,” Emefiele said, adding his staff is studying the documents and he hoped to make a decision on the matter in a “couple of weeks.”
MTN sought an injunction in early September to buy itself time and fight the claim in its biggest market, which wiped as much as 36 percent off its market value within two weeks.
The central bank has asked the Federal High Court in Lagos to deny MTN’s request and said the company should pay an annualised 15 percent interest on the dividends until the matter is ruled upon, and then 10 percent until the whole sum is paid, according to legal documents filed by the regulator.
“They will see they have been given a fair hearing,’’ Emefiele said. “More information has been provided and I’m very optimistic that matters are going to be resolved amicably.’’
Emefiele said the clash with MTN had taken a “global dimension” that it didn’t need to and that he was keen to demonstrate to international investors how open the Nigerian market is, calling the MTN matter “isolated’’ and no reason “for anyone to lose any sleep.’’
“This is not a matter that should have blown so openly,’’ he said. “Nigeria is a country that happens to be very, very open.’’
MTN Chief Financial Officer Ralph Mupita said earlier this month the spat in Nigeria may cause the carrier to reconsider raising cash through an initial public offering of its local unit in Lagos. Instead, MTN may list the business by way of introduction, which places existing securities on the exchange.
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