- MTN Shares Rebound on Possible Reconciliation Over $10.1 BN Claims
The shares of MTN Group Ltd rebounded on Thursday, following a report that the Central Bank of Nigeria has softened its position regarding the illegally transferred $8.1 billion.
MTN shares climbed 7.5 percent to 78.87 rand at 9:32 a.m in Johannesburg on Thursday, its biggest one-day gain in almost six months.
Isaac Okorafor, spokesman for the CBN said on Wednesday that “MTN has provided additional information that may lead to an equitable resolution.” The statement boosted MTN shares on Thursday.
Despite the surge in value, the stock is still down 27 percent when compared to its value before the $8.1 billion claims that wiped out $5 billion from its market value on August 29.
In late August, the Central Bank of Nigeria accused MTN Nigeria of illegally repatriating $8.1 billion through four banks. While in September, the office of attorney general accused the same company of owing $2 billion in back taxes. Bringing total claims to $10.1 billion.
MTN market capital dropped below Safaricom’s market value for the first this month to be the second largest wireless carrier in Africa.
Olusola Teniola, president of the Association of Telecommunications Companies of Nigeria, said: “While this is a step in the right direction, continued dialogue to reach an amicable resolution is a minimum standard expected by the investment community. We look forward to the central bank disclosing the exact reasons for their actions.”
