MTN keeps licence for Nigeria

04 November 2015 - 02:07 By Reuters

Nigeria's telecoms regulator has extended MTN's operating licence, the company said yesterday, quelling fears that Africa's biggest mobile phone firm would have to pay a $5.2-billion fine before it could be renewed. Johannesburg-based MTN is in talks with Nigerian authorities about the fine, imposed on its unit in the west African country for failing to cut off more than 5million users with unregistered SIM cards.Nigeria has been pushing operators to verify the identity of their subscribers, on concerns that unregistered SIM cards are being used for criminal activity."We view this extension as a demonstration of confidence in MTN's capacity to continue to provide groundbreaking and innovative services to its customers," MTN corporate affairs executive Akinwale Goodluck said.The fine comes months after Muhammadu Buhari was swept to the helm of Africa's biggest oil producer after a campaign in which he promised tougher regulation and a fight against corruption.MTN has written to the presidency and the regulator asking for leniency and a review of the fine, a regulatory source said."The letter is asking for a review of the fine downwards. They did not state how much review they want," the source said.MTN, which earns 37% of its revenue from Nigeria, will pay $92.2-million to renew its operating spectrum and extend the licence to 2021, the company said.Shares in MTN, down 25% since the fine was announced last week, were up 1.3% at R150.05 yesterday morning."It's encouraging and pleasing to see MTN and the regulators are able to constructively engage on a commercial basis," said Anthony Sedgwick, a fund manager at Abax Investments in Cape Town.Some analysts have said the size of the fine risked damaging Nigeria's efforts to shake off its image as a risky frontier market for international investors, though others said it showed Nigeria was keen to enforce the law.

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