In the first bit of good news for MTN after what has been a week from hell for the JSE-listed telecommunications group, the Nigerian Communications Commission (NCC) has approved the renewal and extension of its operating spectrum licences in two key spectrum bands, 900MHz and 1,8GHz.
“With this renewal and extension, MTN’s operating spectrum, which was issued along with the digital mobile license in 2001 (with an original expiry date of February 2016), has now been extended to 31 August 2021,” MTN said in a statement to shareholders on Tuesday morning before markets opened for trading.
MTN shares opened up slightly higher on Tuesday morning on the back of the news. They were last seen trading at R149/share, up by 0,6% on Monday’s closing price.
The group’s market capitalisation has fallen by more than R80bn in the past week following news that the NCC had imposed a US$5,2bn (R72bn) fine on MTN for failing to disconnect 5,1m unregistered Sim cards by an 11 August deadline.
MTN said it received a letter from the NCC dated 2 November notifying it about the decision to grant the spectrum licence renewals. MTN must pay the NCC $94,2m (about R1,3bn) in licensing fees to secure the renewals before the end of the year. Also, MTN must fulfil all of its regulatory obligations. TechCentral understands that this does not include payment of the $5,2bn fine, which is being treated as a separate matter.
Meanwhile, Business Day reported on Tuesday that the Public Investment Corp (PIC), MTN’s largest shareholder with a 16,6% stake, has asked for a meeting with the telecoms group over the NCC fine. The newspaper quoted PIC CEO Daniel Matjila as expressing dissatisfaction with MTN’s handling of its Nigerian business and its lack of transparency.
“We need to understand their (MTN’s) side of the story. We need to understand why they are not complying with the regulations,” Matjila is quoted as saying. “This has cost shareholders a lot of money.” — (c) 2015 NewsCentral Media