MTN executive chairman Phuthuma Nhleko will now need to lobby Nigeria’s president directly, as he fights to renegotiate a painful US$5.2bn fine for failing to switch off unregistered users.
Nigerian president Muhammadu Buhari to decide the fate of MTN (JSE:MTN)’s US$5.2bn fine, the country’s communications ministry has said.
A spokesperson for the ministry was cited telling Reuters that top official Adebayo Shittu had said the decision lay with the president, following MTN’s request for leniency.
MTN interim executive chairman Phuthuma Nhleko was reappointed to lead the operator’s charm offensive with the Nigerian Communications Commission (NCC), which imposed the fine, and other top officials.
The fine, announced on 26 October, corresponds to US$1,000 per unregistered customer and was reportedly due on 16 November. In 2013, the West African country introduced a law requiring telcos to cut off unregistered users to stem illegal activity by the likes of militant group Boko Haram.
Nhleko’s lobbying of regulatory and governmental officials paid off quickly, since MTN was granted an extension on the original 16 November deadline. Any fine will now not be due until after negotiations conclude.
NCC officials have reportedly said their intention is not to “kill” MTN, which in Nigeria reaped revenues of N824.8bn (US$4.1bn) in FY 2014.
Globacom, Etisalat and Airtel were also fined for non-compliance, but eventually switched off unregistered users by the end of August.
MTN, noted one source with knowledge of the local market, “has a history of not following the NCC’s rules”.
But the company argues that it was still discussing the number of unregistered users it needed to cut off when the NCC announced the fine.
According to NCC data as of September, MTN has 62.5 million subscribers, Bharti, which trades as Airtel, has 31.1 million and Etisalat, which trades as EMTS, has 23.5 million, while Globacom has 31.3 million.
MTN’s next largest markets are Iran and South Africa, where it has 44 million and 29 million customers respectively. It has a total 231 customers across its 21 markets.
The company has managed to renew and extend its spectrum in the 900MHz and 1800MHz bands, now valid until 2021.