- Communications regulator says it can't say what will happen
- MTN Johannesburg shares in biggest three-day fall since 2008
MTN Group Ltd.’s license renewal in Nigeria could face uncertainty if Africa’s biggest wireless company doesn’t pay a $5.2 billion fine for failing to disconnect customers with unregistered SIM cards, according to the country’s telecommunications regulator.
“I can’t say what will happen if payment is not made,” Tony Ojobo, spokesman for the Nigerian Communications Commission, said by phone from Abuja on Wednesday. “When we get to that bridge, we will cross it.”
MTN shares have fallen about 19 percent this week in Johannesburg, the biggest three-day drop since 2008, valuing the company at about 288 billion rand ($21 billion). The phone operator said on Oct. 26 that the NCC is seeking the penalties because it missed a deadline to disconnect 5.1 million subscribers.
Chris Maroleng, a spokesman at the company’s head office in Johannesburg, said in an e-mailed reply to questions that he had no immediate comment to make.
Nigeria is MTN’s biggest market, where it has more than 62 million customers. Its current license expires in 2016.
“This may mean it must pay before it can be considered for the license renewal,” Bloomberg Intelligence analyst Erhan Gurses said in a note. “MTN has sufficient financial flexibility to pay the fine.”
MTN senior executives are in Nigeria to discuss the penalty with the regulator and will consider making changes to senior local management, according to a person familiar with the matter. Lulu Mguni, South Africa’s high commissioner in Lagos, Nigeria’s commercial capital, said by phone that she’s in talks with MTN on how to assist.