Some stakeholders in the Nigerian Stock Exchange have expressed displeasure over MTN’s constant infractions and troubles with the Nigerian authorities while also urging the leading telco to desist from denting the public’s perception of them.
The stakeholders are also stressed the need for MTN to get its act together by entrenching the culture of best practice, good corporate governance and ensuring that they abide by Nigeria’s laws ahead of the company’s Initial Public Offering (IPO) which is expected by May next year.
This is imperative because as the President of Proactive Shareholders Association (Taiwo Oderinde) have forwarned, “we will fight them on the floor of AGM” if MTN continues to misbehave after the IPO.
He bemoaned the rate at which most multinationals in Nigeria abuse the laws guiding business operation in the country, stating that investors have often been the ones suffering the consequences of the sanctions that follow such abuses. For this reason, MTN must tackle its corporate governance issues before listing Nigerian bourse.
Expressing the same sentiment, the Chief Officer at Foresight Securities Limited (Charles Fakrogba) said wondered why a company like MTN would commit tax crimes as it has been alleged; saying that the company would never misbehave like that in South Africa where it is originally from.
“Can MTN behave this way in South Africa; this is bad image for MTN, and it would be difficult for them when they come to the market. They should ensure that they resolve all issues with the government immediately because their corporate governance is at stake.” -Fakrogba
In the meantime, the company’s IPO is at stake
As we have repeatedly reported, the Central Bank of Nigeria late August ordered MTN to refund the sum $8.1 billion which was accused of illegally repatriating to South Africa. A few days afterwards, the office of Nigeria’s Attorney General disclosed that MTN owes about $2 billion; money that the telco was asked to pay.
Expectedly, all of these developments worried the company which had in the past been at loggerheads with Nigerian regulators. The developments also cast doubt on the company’s long-awaited listing on the Nigerian Stock Exchange.
Meanwhile, the Nigerian Communication Commission (NCC) has insisted that MTN IPO must go on, giving an ultimatum of May 2019 to its effect. Failure by MTN to abide by this directive could result in further consequences for the telco. This is because the NCC may reimpose the initial fine of $5 billion which it placed on MTN in 2015 because of SIM card registration issues.
Despite all the troubles, the IPO is still anticipated. As the stakeholders mentioned admitted, the public offer has the potential to be the biggest in the history of Nigeria’s capital market. This is yet another reason why the company must avoid tarnishing its image with unnecessary controversies so as not to lose the much-needed public’s confidence.