MTN Group proposes to pay US$1.5 billion to settle Nigerian penalty

LAGOS, Nigeria, Capital Markets in Africa — MTN Group Limited has proposed to pay 300 billion naira ($1.5 billion) to settle a record $3.9 billion fine in Nigeria for missing a deadline to disconnect unregistered subscribers, according to a document handed to reporters in the Nigerian Senate.

Africa’s biggest mobile-phone company made the offer in order to settle a dispute that has been running since the fine was first imposed by Nigerian regulators in October. The country’s Senate Committee on Communications met to discuss the matter on Thursday and concluded that the negotiations with MTN must continue with the involvement of Minister of Communications Adebayo Shittu.

MTN shares have declined more than 23 percent since the fine was made public on Oct 26, valuing the Johannesburg-based company at 272 billion rand ($17.6 billion). The penalty was imposed for missing a deadline to disconnect 5.1 million subscribers deemed by the government to be improperly registered in the country that’s battling security issues including Boko Haram’s Islamist insurgency.

MTN’s management, the Nigerian Communications Commission and Shittu must report back to the Senate in two weeks with the outcome of discussions, according to the committee.