(Ecofin Agency) - By midday August 30, 2018, the shares of MTN group lost 20% of its value, on Johannesburg stock exchange where it is listed, with the announcement of a new crisis between the group and Nigeria.

Indeed, the central bank of this country where a large portion of its subscribers are located (54 million out of the 221 million subscribers declared at End June 2018) requires the payment of $8.1 billion of the dividends of MTN group repatriation between 2007 and 2015, in violation of the applicable regulations.

Some banks, namely Stanbic ITBC, Citibank, Diamond Bank and Standard Chartered were also fined for their involvement in those repatriations.

Let’s remind that in 2016, the Nigerian senate announced that it would open an investigation about the transfers. It was concluded that the telecommunications operator had not violated the regulation. With MTN Group having always declared that it is in compliance with the regulation, the management’s protests are logical.

“MTN Nigeria, as a law-abiding citizen of Nigeria, is committed to good governance and to abiding by the extant laws of the Federal Republic of Nigeria. The re-emergence of these issues is regrettable as it damages investor confidence and, by extension, inhibits the growth and development of the Nigerian economy”, the group revealed in a statement.  

However, the investors hold no illusion as they know that Nigerian authorities are rather foolhardy when they officially publish a case. Let’s note that a previous case made MTN Group lose $1 billion in market capitalization and obliged it to list its shares on the Nigerian financial market. Because of that case, investors lost more than 35% in market capitalization within three years. 

Idriss Linge