No merit to $14bn claim, says MTN

MTN has denied allegations that it had repatriated $14bn out of Nigeria improperly.

The claims were made on Tuesday by a Nigerian politician, Dino Melaye, who accused the company of repatriating the funds over 10 years, starting in 2006. The Nigerian state authorities will thoroughly investigate the claim.

Africa’s biggest mobile network operator is alleged to have worked with Citigroup, Standard Chartered, Nigeria’s Stanbic IBTC and Diamond Bank.

MTN Nigeria CEO Ferdi Moolman said the allegations were “completely unfounded and without any merit”.

MTN’s share price declined 0.64% to close at R119.

“I hope MTN has done its homework thoroughly this time …. It is good that MTN is at least communicating,” said Mergence Investment Managers’ Peter Takaendesa.

He said on Tuesday that it was difficult to believe that anyone could use top banks that were heavily regulated locally and internationally to move cash out of the country for such a long period without complying with local requirements.

MTN did not disclose the dividends it received from all its subsidiaries. It fully consolidated that into the group. It disclosed dividends from associate companies, where they owned less than 50%, said Takaendesa.

Nigeria is treated as a subsidiary as MTN owns about 79% of MTN Nigeria. The group plans to list its Nigerian unit as part of the agreement it reached with the Nigerian regulator in June.

Meanwhile, Bloomberg reported that MTN was considering selling a 35% stake in its Ghanaian unit for an estimated $500m. The sale would help the mobile network operator meet conditions it agreed to last year when it spent $67.5m for the right to use spectrum that can carry high-speed mobile data for its customers in Ghana.

The company was granted a 15-year licence for fourth-generation spectrum on the condition that it sold shares to local investors.

MTN recently raised more than $1.3bn from loan agreements to improve its debt structure and to support its credit rating. With Bloomberg