South African telecoms giant, MTN said on Friday that it would pay N330 billion ($1.7 billion) fine to the Nigerian Communications Commission (NCC) in a “full and final settlement” over its failure to disconnect unregistered mobile phone users.
The Johannesburg-based company said in a statement: “MTN Nigeria has agreed to pay a total cash amount of Naira 330 billion over three years.”
The company was fined $3.9 billion last year and has since been in negotiations with the Nigerian government to reduce the penalty.
A man reads a newspaper reporting on its front page the MTN fine by Nigeria’s telecommunications regulator, at a newsstand in Lagos, in October 2015.
The company was hit with the huge demand amid fears that some of the 5.1 million affected lines were being used by Boko Haram insurgents.
After MTN’s announcement, its shares on the Johannesburg Stock Exchange rose as much as 21 percent, on track for the biggest gain since 2008, according to Bloomberg News.
NCC handed down the fine last year and the sum was originally set at $5.2 billion before it is now reduced to $3.9 billion on appeal.
The company statement further said: “MTN is pleased to inform shareholders that the matter has been resolved with the Federal Government of Nigeria.”
MTN Executive Chairman, Phuthuma Nhleko “expresses his thanks and gratitude to (the Nigerian government) for the spirit in which the matter was resolved,” it added.
MTN paid one instalment in February and has scheduled six other payments to cover the fine by May 2019.
“The news is a huge relief to investors, given the fact that Nigeria ended up not imposing the initial amount of the fine,” Dobek Pater, telecoms specialist at the Africa Analysis consultancy, told AFP.
“MTN could not afford to lose a major market such as Nigeria and by paying the fine it shows that they still have faith in keeping their investment there.”
President Muhammadu Buhari announced in December the group was “technically” defeated but attacks continue.
“The concern of the federal government was basically on the security, not the fine imposed on the MTN,” Buhari said in March.
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