Shares of Africa’s biggest telecoms firm MTN stopped from trading as fallout from record Nigeria fine continues

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South African multinational has failed to convince Nigerian regulators to lower the $5.2 billion fine, according to reports.

TRADING in MTN Group Ltd. shares was halted on the Johannesburg Stock Exchange on Monday amid uncertainty over a $5.2 billion fine for failing to comply with an order to disconnect customers with unregistered phone cards.

The stock fell as much as 9.7% before paring losses and was the biggest decliner on the benchmark FTSE/JSE Africa All Share Index, according to data compiled by Bloomberg. Trading was halted with the stock 5.3% down at 149.48 rand by 10:33 a.m. in Johannesburg. The securities have slid 22% since MTN said it’s facing the fine on October 26.

MTN failed to convince the Nigerian Communications Commission to lower its penalty, CAJ News in Nigeria reported, citing a company official familiar with the talks. MTN hasn’t agreed to the fine and continues to meet with Nigerian authorities to challenge it, a person familiar with the matter told Bloomberg, asking not to be identified because the matter is private.

READ: Buhari’s Nigeria: Tough day at office for SA multinationals as MTN hit with record fine; bank directors shut out

Investors “were expecting something to come out at the weekend and it hasn’t and now the pressure is on because they’ve been told that they have to pay this fine by next week,” Rob Pietropaolo, a trader at Vunani

Private Clients (Pty) Ltd., said by phone from Johannesburg. “Because of their lack of communication, investors are punishing the share and obviously running for safety.”

MTN will release a statement later on Monday, Nik Kershaw, head of investor relations, said by phone. A statement will be released by the JSE, Pheliswa Mayekiso, a spokesman for the bourse, said by phone.

MTN spokesman Chris Maroleng declined to comment on the talks with regulators. MTN has been in talks with the government, but “I don’t have an update,” Tony Ojobo, a spokesman for the Nigerian Communications Commission, said by phone from Abuja, the capital.

Vice President Yemi Osinbajo’s spokesman, Laolu Akande, declined to comment immediately about the reports MTN met with the presidency.

Nigeria is MTN’s biggest market with 62 million customers as of September. The penalty, which has to be paid by November 16, relates to the timing of the disconnection of 5.1 million MTN Nigeria subscribers in August and September and is based on a charge of 200,000 naira ($1,013) for each unregistered subscriber.

—Bloomberg. With assistance from Yinka Ibukun in Lagos.

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