Indications that simmering tensions between MTN and Nigerian authorities are fading have triggered a turnaround in the company's share price, which this week rose by more than 4%.In afternoon trade on Friday, MTN shares were trading at levels last seen in 2012, indicating that investors were relieved by progress made in negotiations between the company and Nigeria.This week, the mobile operator said it had paid 50-billion naira (about R4-billion ) to Nigerian authorities who are demanding N780-billion as a penalty after MTN failed to disconnect 5.1million unregistered sim cards.story_article_left1Tony Ojobo, spokesman for the Nigerian Communications Commission, said the federal government had indicated that the money had been received."For now that's just an initial step taken by MTN. I guess further discussions are going to follow," Ojobo said.In addition to the payment, MTN also withdrew its case against the commission in the High Court in Lagos. In December, the commission reduced the initial fine by 25% .MTN approached the court as it believed the regulator did not have the jurisdiction to impose the high fine. The commission launched its own application claiming that MTN had filed its papers in the incorrect court.The federal government also tried to interdict MTN from accessing several of its bank accounts. The court dismissed this application.MTN Group spokesman Chris Maroleng said there was continuous engagement between an MTN team, led by executive chairman Phuthuma Nhleko, and Nigerian authorities to settle the matter.Dobek Pater, director at Africa Analysis, said payment of the fine was effectively an admission of guilt - "$250-million is a considerable amount. It almost represents the first instalment."Pater said MTN was likely to be negotiating to pay the fine in instalments.MTN has said previously that paying the whole fine immediately - even though it was reduced by 25% from the original amount - would affect cash flows.MTN Nigeria represents a significant proportion of revenue for the company.The group derived at least 50% of earnings before interest, tax, depreciation and amortisation margins from Nigeria, where there are opportunities in offering mobile broadband and fixed-line internet, said Pater.Nigeria would lose about $5.5-million in annual investment in that market if MTN had to leave, he added.The company has invested more than $15-billion since starting its business in that country about 15 years ago.story_article_right2Nigeria's scrap with MTN risks a loss of investor confidence.US investor firm Wells Fargo & Co last year called the fine a "shakedown" by Nigerian regulators.The Nigerian government has been widely reported to be fundraising to cover shortfalls from lower oil prices.It is not the first time a multinational has been fined in Nigeria. In 2010, Siemens agreed to pay N7-billion after it was accused of tender-rigging and corruption."As long as MTN goes out and plays by the rules the NCC cannot go out and bully it. If it does then MTN does have recourse to the legal system," Pater said.But MTN had to be careful, as "there are some nuanced grey areas because of the dominant market player status it now has".MTN said recently that group earnings would drop by at least 20% for the 12 months to December, largely because of having to disconnect 5.1million sim cards in Nigeria and authorities in the country withholding regulatory services from the company...