CBN SANCTION: MTN Faces Mounting Pressure To Pay Fine
Africa’s telecom giant, MTN Group Ltd; continues to face more trouble with the Nigerian government over its latest fine by the authorities.
The wireless carrier is facing mounting pressure to transfer the $8.1 billion to Nigeria after the Central Bank of Nigeria, argued that it should pay interest on the disputed repatriation of dividends until it surrenders the full amount.
MTN should pay 15% annualized interest until the courts rule on the conflict, the CBN argued in documents filed with the Federal High Court in Lagos in the past week and seen by Bloomberg News on Thursday.
The CBN further argued that MTN shouldn’t be given an injunction that would let it wait for a ruling before transferring the amount.
The news has already started affecting MTN’s stock prices as it fell as much as 11% in Johannesburg on Friday, the steepest decline since Sept. 4, and was trading 9.3% lower at 79.17 rand at 9:14 a.m.
Recall that the CBN alleged in late August that MTN and four of its banks -- Standard Chartered Plc, Citigroup Inc., Stanbic IBTC Plc and Diamond Bank Plc -- illegally repatriated money from Nigeria.
MTN sought an injunction in early September to buy itself time and fight the claim in its biggest market, which wiped as much as 36% off its market value.
The court filings suggest the regulator is not prepared to back down over its allegations, despite central bank Governor Godwin Emefiele saying last week that the dispute would be resolved soon and that “everyone will be happy.”
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