In a hard-hitting statement, MTN’s largest shareholder, the Public Investment Corp (PIC), has “noted” the resignation of group CEO Sifiso Dabengwa but said that “a lot more people need to take collective responsibility for the fine that was imposed on MTN Nigeria for alleged failure to comply with regulatory requirements in that country”.
MTN announced on Monday morning that Dabengwa had resigned with immediate effect, two weeks into the crisis that has wiped more than R60bn off its market value. The Nigerian Communications Commission has given MTN until 16 November — next Monday — to cough up a US$5,2bn fine for failing to cut off as many as 5,1m unregistered Sim cards or face the consequences.
In its statement, the PIC described Dabengwa’s resignation as “the noble thing to do”.
But it warned that there are still serious questions about the role that the group’s board of directors has played in the crisis. The board, it said, is “charged with exercising fiduciary responsibilities for the benefit of shareholders”.
“In particular, we question the role of the risk and compliance function within MTN. Could risk and compliance have not foreseen that there were instances of noncompliance, which could lead to penalty?” the PIC said in the statement. “What actions were taken to address noncompliance and mitigate possible fallout?”
It said it will request an interview with interim executive chairman Phuthuma Nhleko “to understand exactly how he plans to turn things around for the benefit of shareholders”.
“The PIC is of the view that the current challenges need to be dealt with immediately to ensure that MTN complies with laws and regulations wherever it operates to ensure long term sustainability of the company.”
The PIC holds 16,6% of MTN’s equity. — © 2015 NewsCentral Media