The Nigerian Communications Commission (NCC) has issued MTN a deadline to complete the payment of its N330 billion SIM infraction fine – with a balance of N55 billion – by Friday, May 31st, 2019.
A fine of N1.04 trillion was imposed on the mobile network operator in October 2015 for failure to disconnect about 5.2 million subscribers, whose Subscriber Identification Module (SIM) lines were not registered properly within a given deadline.
Despite the irregularity in registration, economic activities were carried out on the lines, an infraction of the provisions of the Telephone Subscribers Registration Regulations 2011, as provided by the NCC.
According to the Executive Vice Chairman of NCC, Umar Danbatta, it was agreed that MTN would pay a balance of N280 billion in six tranches, following six months of negotiation which led to the reduction of the initial fine to N330 billion.
In line with the payment arrangement, the company has so far paid N275 billion to the federal government. As explained by Danbatta, this was in addition to the ‘goodwill’ payment of N50 billion earlier made by MTN to the government.
“What this means, according to the staggered arrangement, is that May 31, 2019, would be the deadline for the telecoms company to pay the (balance) sixth and final tranche of the balance of N55 billion,” the NCC Chief added.
Other conditions of the agreement, which was reached in a way that is unlikely to debilitate the business interests of other operators regulated by the commission, include an official apology from MTN to Nigerians and subscription to the compulsory observance of the Code of Corporate Governance for Telecoms Industry.
More so, the recent listing of MTN on the Nigerian Stock Exchange (NSE) was part of the terms of negotiation for payment of the fine. As a result, Danbatta said that the commission has succeeded in empowering Nigerians “to control, manage and own one of the dominant telecommunications companies in the country” by owning shares in MTN Nigeria.
Rightly so, with MTN shares becoming available in the capital market, the commission has successfully translated one of its important function into reality, which is to “promote local investment and ownership in the telecom sector.”
However, the nature of the company’s listing on the stock exchange – by Introduction – does not exactly give every Nigerian access to purchase its shares. This is because they are scarce in the market and only shareholders of the company have traded (off the market) between themselves so far, with even stockbroking firms unable to bid for their clients.
This has led to allegations that investors are being prevented from buying shares in the company- claims which MTN has been forced to deny publicly. Also, the company is not issuing new shares since it didn’t list by an initial public offering (IPO) that would have mandated it to avail new shares for new investors.
Listing by Introduction on the stock exchange means that only existing shareholders interested in selling their shares on the market can do so and they are not obliged by any rule to tender their shares for trading. As stated by the NSE, they can only be urged to make their stocks available.
MTN Nigeria’s (MTNN) stock, which opened at N90 listing price last week, has been on a rally ever since. A major jump in price has seen the stock currently trade at N131.70 on the market, as investors who want to increase their stake in the most wanted stock on the NSE are willing to pay more than its price.