MTN near to hiring new CEO

Johannesburg - Embattled mobile network MTN Group [JSE:MTN] says it is near to hiring a new chief executive officer after the previous head of the company quit late last year.

Local telecoms veteran Sifiso Dabengwa resigned as MTN Group CEO last November after Nigerian regulators slapped the company with a massive $5.2bn fine.

The Nigerian Communication Commission (NCC) imposed the fine on MTN after the mobile network failed to disconnect 5.2 million unregistered SIM cards in a timely manner.

Following the resignation of Dabengwa and MTN Nigeria CEO Michael Ikpoki, the NCC subsequently cut the fine to $3.9bn.

Amid the saga, MTN executive chairman Phuthuma Nhleko took over the reins of the company.

Nhleko, in MTN’s 2015 integrated report that was released earlier this year, said the company plans to “identify and name a new group CEO” by the end of June 2016.

And the company on Wednesday reiterated this plan.

“The search for a new MTN Group CEO is well underway and as previously noted we hope to make an announcement on this matter prior to the end of June 2016 at the latest,” said MTN in a statement to shareholders on Wednesday ahead of its annual general meeting.

MTN still engaging authorities

MTN’s latest announcement about the hunt for a new CEO comes after Bloomberg reported on the weekend that Nigerian authorities have suspended talks on the company’s mega fine.

Lawmakers in Nigeria earlier this year called for MTN’s fine to be increased.

But MTN told shareholders on Wednesday that it is still engaging with authorities in the West African country.

“We continue our engagement with the Nigerian authorities and are awaiting feedback,” said MTN.

“We remain optimistic on reaching a conclusion on this matter in the short term. We will continuously monitor developments with regards to the Nigerian fine and will review the adequacy of the provision at the end of the reporting period,” said the company.

MTN’s SIM registration woes in Nigeria have impacted its overall performance.

The company told shareholders on Wednesday that as at April 30 2016, the group only increased its subscriber base by just 1% to 230.3 million year-on-year across Africa and the Middle East.

“This was largely impacted by the 7% decline in subscribers in MTN Nigeria and the 11% decline in MTN Uganda, mainly as a result of the non-compliant subscriber deregistration process in these countries which was only completed in quarter one of 2016,” said MTN,” said the company.

In March, MTN reported a 51% drop in full-year profit amid the Nigerian fine.

The plunge in MTN’s share price has further resulted in rival Vodacom becoming the biggest telecoms operator in Africa by market capitalisation this year.

MTN’s share price on Wednesday morning, though, was up near 2.5% in Johannesburg to R131.29 at 10:02 following the company’s note to shareholders.

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