MTN advises shareholders to exercise caution when dealing in its shares

After the Nigerian Communication Commission (NCC) fined MTN Nigeria $5.2 billion over the timing of the disconnection of 5.1 million unregistered SIM cards in August and September, its Group CEO resigned and the company has advised its shareholders to be cautious when dealing in the company’s shares.

Before serving as CEO for four years Mr Dabengwa had served as the company’s chief operating officer and as head of the Nigerian operations before that.

Following the fine, MTN’s shares fell the most in 17 years. MTN’s stock declined more than 12 per cent, the biggest one-day decline since November 1998, to 167 rand.

The fall was considered the lowest closing price since June 2013 and values the Johannesburg-based company at 308 billion rand ($23 billion). MTN was the biggest decliner in percentage terms on the benchmark FTSE/JSE Africa All Share Index, while also weighing more on the gauge than any other security on that day.

In the statement announcing Dabengwa’s resignation, MTN said, “Stakeholders are reminded that MTN will continue to inform them of any material engagements with the Nigerian authorities via the Stock Exchange News Service of the JSE Limited (SENS).

Shareholders are advised to continue to exercise caution when dealing in the Company’s securities until a further announcement is made.”

Meanwhile, according to a report by THISDAY newspaper of Nigeria, pressure is mounting on Mike Ikpoki, the CEO of MTN Nigeria to resign.

Ikpoki served as CEO of MTN Ghana from 2011 to 2013 before he was appointed to serve in Nigeria.

By Emmanuel K. Dogbevi