While it dominates market share and infrastructure, the South Africa-owned giant’s biggest battles are with the local authorities rather than other telecoms rivals. Over the past five years, MTN has faced potential fines of up to $15 billion in Nigeria for a range of alleged misdeeds. A permanent resolution is crucial as MTN looks to continue doing business in its most important market. Amid murmurs and a denial of shutting down its Nigerian unit, there’s ample sign of how costly these disputes can be for investors. After the tax debt claims by Nigerian authorities, MTN’s stock tanked and closed at a nearly 12-year low. MTN has long maintained that its legal tussles with Nigeria’s government will not dent its interest in its biggest market despite investor concerns. Indeed, the company has committed to launching a mobile money service this year in Nigeria. Regardless, the disputes have had an impact: MTN has already revised plans for a highly anticipated initial public offering on the Nigerian Stock Exchange. While it will still list its shares locally, the company has taken up a listing by introduction option which will see it only list already existing shares without raising new funding or issuing new shares.
SOURCES: QUARTZ AFRICA