MTN Group Ltd. is trying to reduce a $5.2 billion fine imposed by Nigeria’s telecommunications regulator by as much as 80 percent and is considering borrowing money from banks to help settle the penalty, according to Renaissance Capital.
“MTN is pushing to reduce the fine by 60 percent to 80 percent,” Adesoji Solanke, RenCap’s head of research in Nigeria, said in a note to clients on Wednesday, citing a bank he didn’t identify. A second lender said that “MTN is considering borrowing from banks, as it recently checked what the banks’ lending capacity to it is,” the analyst said.
MTN has until Nov. 16 to pay the penalty, which relates to the timing of the disconnection of 5.1 million subscribers and is based on a charge of 200,000 naira ($1,005) for each unregistered customer. The Johannesburg-based company’s shares lost almost a quarter of their value following the disclosure of the fine, before recovering 9 percent over the past two sessions.
“We don’t comment on banking matters and banking regulators in Nigeria are best placed to provide context on these matters,” MTN spokesman Chris Maroleng said by phone. “I don’t have that information,” Tony Ojobo, a spokesman for the NCC, said in a text message.
MTN shares gained as much as 4.1 percent and traded 3.5 percent higher at 160.89 rand as of 2:28 p.m. in Johannesburg. The stock is down 27 percent this year, valuing the company at 297 billion rand ($21.5 billion).
MTN is being advised by some unidentified banks as the company pleads its case with the regulator, according to Solanke. A decision to borrow would be one of financial management rather than an indication of stress, he said.
Source: Bloomberg
DROP YOUR COMMENT BELOW
No comments:
Post a Comment