South African telecoms giant MTN has won a respite on the payment of a massive $5.2 billion fine imposed on the company in Nigeria to allow for negotiation, which is now being led by Freedom Phuthuma Nhleko, a former CEO of the MTN Group who is Forbes-listed as one of Africa’s top 10 millionaires.
The Nigerian Communications Commission (NCC) slapped the penalty on Africa’s largest telecoms firm for failing to deactivate 5.1 million unregistered SIM cards, sending its share price plummeting and leading to the resignation of chief executive Sifiso Dabengwa.
The deadline for the fine to be paid was November 16, but the company announced that the NCC had agreed that it will not be payable until the end of negotiations entered into by acting executive chairman Phuthuma Nhleko, who has taken on Dabengwa’s role for six months.
“Shareholders are advised that the executive chairman of the company, Mr Phuthuma Nhleko, has personally met with the Nigerian authorities to continue the ongoing discussions with them regarding the fine,” the statement said.
“These discussions include matters of non-compliance and the remedial measures that may have to be adopted to address this.
“Shareholders are advised that the Nigerian authorities have, without prejudice, agreed that the imposed fine will not be payable until the negotiations have been concluded.”
Nigeria, Africa’s most populous country, is MTN group’s largest market where it had over 62.8 million subscribers by the second quarter of this year.
The Johannesburg Stock Exchange (JSE) has launched an investigation into MTN for “possible insider trading” before the company announced it had been hit by the fine. The probe could result in JSE slapping MTN with another hefty penalty or result in criminal charges.
NHLEKO AS HELMSMAN
Freedom Phuthuma Nhleko (born 7 April 1960) is a South African businessman, former CEO of the MTN Group. The group, which employs 6,000 people, reported turnover of 29 billion Rand for the year ended March 2005.
Nhleko is also chairman and one of the founding members of Worldwide African Investment Holdings, an investment holding company with interests in the petroleum, telecommunications and information technology industries. He helped build the company to a book value of investments of about R3,5bn.
As CEO of MTN group, Mr Nhleko has been appointed in 2007 to the Board of Directors of the GSM Association (GSMA), the global trade association for mobile phone operators. He serves the board during a two-year term from January 2007.
He was previously a senior member of the Standard Corporate & Merchant Bank corporate finance team. He also practised as a civil engineer and project manager for the Urban Foundation, and was a senior road engineer for the Ministry of Works in Swaziland.
Nhleko is a director of South Africa’s publishing giant Johnnic Holdings, the Nedbank Group and Old Mutual SA. His academic qualifications include a B.Sc in civil engineering from Ohio State University and an MBA in finance from Atlanta University.
(Additional details from AFP, Wikipedia)