MTN Nigeria has cancelled its earlier plan to go public in 2016, citing the current face-off between the telecom operator and the Nigerian Communications Commission [NCC].
An authoritative source in MTN told Business Journal that the earlier plan to take MTN Nigeria public has been shelved for now until the lingering crisis between MTN and NCC over the $5.2 billion dollars, now $3. 9 billion is sorted out successfully.
The source said: “For now, the plan to go public is in the cooler until we settle the more important issue of the fine imposed on us by the NCC. The management is not talking about it at the moment. Even our Group officers in South Africa are also cool on the issue until the fine crisis is resolved.”
He said another reason could be what he called “an emerging perception at the Group headquarters in South Africa that Nigeria has suddenly become an unfriendly business environment for MTN, and thus, taking the company public in such a negative market could backfire on the firm in the long term.”
He continued: “Our people in South Africa are really feeling bad over the $5.2 billion or $3. 9 billion fine imposed on the company by the NCC. They consider it an act of bad faith to effectively bring down the company, thus making it difficult to take the company public in Nigeria.”
It would be recalled that MTN Nigeria took legal action against the NCC in late, challenging powers of the telecom industry regulator to impose the said $5.2 billion, but later reduced $3. 9 billion fine on it for failing to deactivate unregistered subscribers on its network.
But at the recent hearing of the matter, MTN Nigeria appealed for out-of-court settlement, which the court granted and adjourned the matter to March 18.
In a swift reaction however, the Minister of Communication Technology, Adebayo Shittu insisted that MTN Nigeria must first withdraw the suit against NCC from the court before any talk of settlement outside the court system.