Last month, MTN, Africa’s largest mobile operator, appeared close to a resolution of its unregistered sim card dispute after making a goodwill down payment to the Nigerian government. But that may no longer be the case.
Nigerian lawmakers are pushing back over the legalities of a fine reduction just two weeks after it seemed MTN could settle the dispute for a reduced fine of $1.5 billion, less than half the $3.9 billion it was asked to pay.
The lawmakers say reducing the fine should have been done after amending the Nigerian Communications Commission Act. “For you to adjust the fine, you have to adjust the law,” Yakubu Dogara, speaker of the House of Representatives has said.
Another House of Representatives member, Ehiozuwa Agbonayinma, was quoted by Nigerian daily, ThisDay, suggesting the fine by tripled to $15.6bn—three times the original $5.2 billion fine. While it is unclear how he came to that figure or whether or not it is even a realistic prospect, the suggestion was enough to wreak havoc on MTN’s share price as the stock tanked on Thursday.
Since news of the lawmakers’ deliberations emerged, MTN shares have fallen 10% forcing the South African company, in a bid to stem the slide, to issue a statement asking investors not to react to the speculation.
MTN urged investors to “refrain” from making “decisions based on press reports” as it continues to engage with Nigerian authorities to seek a resolution. The company also said it will wait for “clarity and further guidance on the fine” from the Nigerian government.
MTN recently came in for flak from Nigeria’s president Buhari who blamed the company for the rise of Boko Haram following the failure to disconnect unregistered sim cards believed to be exploited by terrorists.