Nhleko to tackle Nigeria penalty
EX-MTN BOSS RETURNS AS DABENGWA QUITS
SOUTH Africa’s MTN Group has asked its former head to take temporary charge of Africa’s biggest mobile telecoms company after its chief executive resigned over a R73.5-billion fine imposed by Nigeria.
Nonexecutive chairman Phuthuma Nhleko was named executive chairman of MTN for a period of up to six months after Sifiso Dabengwa stepped down as chief executive with immediate effect yesterday.
The priority for Nhleko will be to try to get a reduction in the fine demanded by the Nigerian Communications Commission (NCC).
Nigeria, Africa’s most populous nation, is MTN’s largest market and contributes more than a third of its revenues.
MTN said it was continuing talks with the authorities in Nigeria over the fine.
The NCC penalised MTN last month for failing to cut off users in Nigeria with unregistered SIM cards.
The Nigerian regulator has been pushing cellphone net- work companies to verify the identity of their subscribers because of fears that unregistered SIM cards were being used for criminal activity in a country facing Islamic militant group Boko Haram’s insurgency.
MTN’s largest shareholder, South Africa’s Public Investment Corporation (PIC), said it wanted to meet Nhleko about his plans to tackle the fine and wants more staff at MTN to take responsibility for the penalty.
“A lot more people need to take collective responsibility for the fine ... for the alleged failure to comply with regulatory requirements,” the PIC’s chief executive Daniel Matjila said in a statement.
MTN shares have slid by nearly 20% since October 26 when the charge was first reported, but were up 1.4% at R159.65 yesterday afternoon, following news of Nhleko’s appointment.
“The board chose Nhleko because of his vast experience in Nigeria and his in-depth knowledge of the company,” MTN’s spokesman Chris Maroleng said.
Dabengwa had been chief executive of MTN since 2011 when he took over from Nhleko.
“Due to the most unfortunate prevailing circumstances occurring at MTN Nigeria, I, in the interest of the company and its shareholders, have tendered my resignation with immediate effect,” Dabengwa said in a statement.
MTN also faces a Johannesburg bourse investigation on the timing of its announcement of the penalty.