MTN buys Visafone Nigeria as court mulls $3.9bn fine

Lagos - MTN Group agreed to buy internet provider Visafone Communications of Nigeria to expand in Africa’s biggest economy even as the South African company awaits a local court ruling on a record $3.9bn fine in its biggest market.

The acquisition will ensure that “Nigerians experience a boost in the quality of broadband internet services” and data speeds, MTN Nigeria Executive Amina Oyagbola said in an e-mailed statement on Friday, without disclosing terms.

Visafone offers voice as well as online services in Nigeria, according to the statement.

MTN said on December 17 it will ask a Lagos court to rule on the fine, which was imposed by the Nigerian telecommunications regulator for failing to meet a deadline to disconnect 5.1 million unregistered subscribers.

The initial fine of $5.2bn was reduced by 25% earlier in December following talks with the regulator led by MTN Chairman Phuthuma Nhleko.

MTN shares have declined 34% since the fine was made public on October 26, valuing the company at R232bn. The stock traded 0.6% higher at 127.01 rand as of 11:01 a.m. in Johannesburg.

Lagos-based Visafone is a wireless network provider founded in 2007 by Jim Ovia, a Nigerian businessman who also created Zenith Bank.

MTN had about 62.5 million subscribers in Nigeria at the end of September, almost a quarter of the total of 233 million customers.

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