Nigerian authorities are renewing the license of the MTN telecommunications group as the company faces a multi-billion-dollar fine in the West African country, the South African based telecommunication company reported on Tuesday.
The Nigerian Communications Commission extended MTN’s operating license to 2021 at a fine of $94.2 million, the MTN Group said in an announcement. Nigeria is by a wide margin MTN’s biggest business sector, with 62 million users among Nigeria’s 170 million people in the country, the giant telecommunications said.
A week ago, the commission fined MTN $5.2 billion for neglecting to disconnect millions of unregistered cellphone subscribers, with speculations about the company’s future in Nigeria.
The $5.2 billion fine is equivalent to no less than two years MTN profile from Nigeria subscribers and about three times the $1.8 billion that the telecommunication company has invested in the West African countries, according to the report released on the company’s website. Africa’s leader in cellphone service provider, MTN paid $285 million for an operating license in Nigeria in 2001.
MTN’s share price dropped drastically and the Johannesburg Stock Exchange stopped the trading of its shares on Monday until the telecommunication company assured shareholders that it was negotiating the fine with Nigerian authorities.
Once the company’s trading continued, shareholders were warned to trade carefully with the company’s securities, MTN said in its announcement to the traders.
Nigerian daily newspapers reported that MTN is requesting more time to pay the fine due Nov. 16.
MTN Company was launched in 1994 in South Africa, and has 233 million subscribers in Africa, Asia and the Middle East, as indicated by the company.
By re-issuing MTN with a license, the Nigerian government may be saying to prospective investors that, as long as you follow the law, you are welcome to do business.