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MTN attempts fine resolution amid CEO exit – report

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(Image Source: Bloomberg.com)
MTN Nigeria Interim CEO, Phuthuma Nhleko. (Image Source: Bloomberg.com)

According to a report via Bloomberg, MTN Group will attempt to strike a deal with Nigerian authorities over the NGN 780 billion fine imposed on the company back in 2015.

Sources close to the company revealed to Bloomberg that the group’s interim CEO, Phuthuma Nhleko, is allegedly preparing to step down.

The source further revealed that Nhleko is making plans to leave his post in May 2016; however it is reported that Nhleko won’t step away from his operational role until he comes to an agreement with the Nigerian attorney general, said the source, who – according to Bloomberg – asked not to be identified because the plans are private.

In November 2015, the chairman agreed to run MTN for six months in order to “proactively deal” with Nigerian authorities after Chief Executive Officer Sifiso Dabengwa resigned, Nhleko said at the time.

According to Bloomberg, the plan for an on-time departure suggests an end to the MTN crisis, which had gutted the share value of Johannesburg-based MTN by one-third. Getting it solved has been the top priority of Nhleko, who ran MTN as CEO for almost nine years until 2011. The company proposed a $1.5 billion package last month that included 150 billion naira ($754 million) in cash plus incentives. The Nigerian government hasn’t formally responded, though some lawmakers have called for even bigger fines.

The report further revealed that the government hasn’t taken a position on the MTN offer and is still fielding responses from stakeholders, Abubakar Malami, Nigeria’s minister of justice and attorney general..

“No negotiation has taken place yet,” Malami said. “We asked that MTN should put their position on paper, which they did, and we circulated to stakeholders.”

MTN spokesman Chris Maroleng declined to comment. Nigeria imposed the fine on MTN in October 2015 for missing a government-imposed deadline to disconnect 5.1 million subscribers who had been declared unregistered following a crackdown on security.

Darryl Linington
Follow @DarrylLinington on Twitter

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