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MTN CEO Dabengwa Resigns After $5.2 Billion Nigeria Penalty

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MTN

MTN Group Ltd. Chief Executive Officer Sifiso Dabengwa resigned from Africa’s biggest mobile-phone company as senior executives negotiate with Nigerian regulators about the payment of a $5.2 billion fine. The shares declined.

Dabengwa will be replaced by Chairman Phuthuma Nhleko, 55, for as many as six months while the company searches for a permanent successor, Johannesburg-based MTN said in a statement on Monday. Dabengwa, 57, resigned over the weekend after consultation with the board and his financial compensation hasn’t been decided, spokesman Chris Maroleng said by phone.

“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 the statement. He didn’t answer calls to his mobile-phone seeking further comment.

Nhleko led MTN as CEO for almost nine years until 2011, increasing subscriber numbers 30-fold and expanding the company into new markets such as Iran and Syria. MTN now has more than 230 million customers in 22 countries. Nhleko said he will deal with the Nigerian Communications Commission directly about the fine, which was imposed for missing a deadline to disconnect unregistered subscribers.

“I proactively deal with the Nigerian regulator and will continue to work with them in addressing the issues around unregistered subscribers as a matter of urgency,” Nhleko said in the statement.

MTN has until Nov. 16 to pay the Nigeria penalty, which relates to the timing of the disconnection of 5.1 million subscribers and is based on a charge of 200,000 naira ($1,008) for each unregistered customer. The company’s shares lost almost a quarter of their value following the disclosure of the fine, before a partial recovery.

The stock fell as much as 3.5 percent in Johannesburg and traded 1.6 percent lower at 155 rand as of 9:37 a.m. local time. That extended the decline since the penalty was made public on Oct. 26 to about 19 percent, valuing MTN at 286 billion rand ($20 billion).

“Sifiso leaving is a loss to the industry,” Shameel Joosob, CEO of MTN competitor Vodacom Group Ltd., said by phone. “I see this issue as a bump in the road. They will probably negotiate a settlement on the fine.”’

Bloomberg

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Aliko Dangote Remains Africa’s Richest Man With $12.1 Billion Net Worth -Forbes

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Aliko Dangote Remains Africa’s Richest Man With $12.1 Billion Net Worth -Forbes

Nigerian industrialist, Aliko Dangote, is Africa’s richest person for the tenth year in a row.

In the Forbes Africa latest billionaires list, Dangote’s total net worth stood at $12.1 billion, a $2 billion increment when compared to last year. Thanks to the 30 percent increase in the price of Dangote Cement share.

Nassef Sawiris of Egypt followed Dangote with $8.5 billion net worth with the majority of his investments coming from construction and other investments.

In third place was Nicky Oppenheimer of South Africa with an $8 billion total net worth.

Mike Adenuga and Abdulsamad Rabio, the two Nigerians, came fifth and sixth with $6.3 billion and $5.5 billion net worth, respectively.Forbes Africa's billionaires list

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Portland Paints, Chemical and Allied Products Plc Agreed to Merge

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Portland Paints

Portland Paints, Chemical and Allied Products Plc Agreed to Merge

Portland Paints and Products Nigeria Plc and Chemical and Allied Products Plc have agreed to merge, according to the latest statement from both companies.

In a statement released through the Nigerian Stock Exchange, the Board of Directors of CAP said we are “pleased to inform you that following discussions and negotiations, the Boards of CAP and Portland Paints have reached an agreement to undertake a merger between both entities (the “Merger” or the “Proposed Merger”).

Accordingly, we “hereby present to you the terms and benefits of the Proposed Merger for your consideration and seek your support and approval to effect the Proposed Merger.

“The Proposed Merger presents a compelling opportunity to create significant value for shareholders of CAP and achieve the company’s strategic growth objectives as a larger company with a broader product portfolio, more corporate owned brands and diversified revenues.

“The resultant entity is also expected to benefit from enhanced distribution capabilities in addition to economies of scale and operational efficiencies.”

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Tony Elumelu Acquires Shell, Total, ENI Stakes in OML 17

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Tony Elumelu Acquires Shell, Total, ENI Stakes in OML 17

Tony Elumelu owned Heir Holdings Limited and its related company Transnational Corporation of Nigeria Plc on Friday announced it has completed the purchase of 45 percent stake in Oil Mining Lease (OML 17) through TNOG Oil and Gas Limited.

The acquisition includes all assets of Shell Petroleum Development Company of Nigeria Limited (30 Percent), Total E&P Nigeria Ltd (10 percent) and ENI (five percent) — in the lease.

It was further stated that TNOG Oil and Gas Limited will also have the sole right to operate OML 17.

The field presently has a production capacity of 27,000 barrels per day. Also, there are estimated 2P reserves (proven and probable) of 1.2 billion barrels and an additional one billion barrels in possible reserves — all of oil equivalent.

A consortium of global and regional banks and investors provided a financing component of $1.1 billion for the largest oil and gas financing in Africa in over a decade.

In a statement released on Friday, Shell said the completion was after all the necessary approvals have were received from authorities.

“A total of $453m was paid at completion with the balance to be paid over an agreed period. SPDC will retain its interest in the Port Harcourt Industrial and Residential Areas, which fall within the lease area,” the SPDC said.

Speaking after the completion of the deal, Elumelu said “We have a very clear vision: creating Africa’s first integrated energy multinational, a global quality business, uniquely focused on Africa and Africa’s energy needs. The acquisition of such a high-quality asset, with significant potential for further growth, is a strong statement of our confidence in Nigeria, the Nigerian oil and gas sector and a tribute to the extremely high-quality management team that we have assembled.

“As a Nigerian, and more particularly an indigene of the Niger Delta region, I understand well our responsibilities that come with stewardship of the asset, our engagement with communities and the strategic importance of the oil and gas sector in Nigeria. We see significant benefits from integrating our production, with our ability to power Nigeria, through Transcorp, and deliver value across the energy value chain.

“I would like to thank Shell, Total and ENI, for the professionalism of the process, the Federal Government of Nigeria, the Ministry of Petroleum Resources, and the NNPC for the confidence they have placed in us.”

Tony Elumelu is the Chairman of Heirs Holdings Limited, Transcorp and United Bank for Africa Plc.

Also, read Transcorp Plc Acquires FGN’s 100% Equity in Afam Power for N105 Billion

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