Johannesburg - The share price of Africa’s biggest mobile network MTN fell by over 6% in early morning trade on Monday morning before rebounding again.
MTN’s share price on the Johannesburg Stock Exchange fell from R148.25 at 09:02 on Monday to R142.77 at 10:18. However, the share price rebounded at 10:32 to R148.86.
The early morning fall in its share price came amid an unconfirmed report by the Lagos-based Vanguard that MTN had agreed to paid a $5.2bn fine in Nigeria, albeit possibly in staggered payments. Spokespeople for MTN were not available for comment on the Vanguard report on Monday morning.
Last week, MTN confirmed that it’s received a $5.2bn fine from the Nigerian Communications Commission (NCC) for alleged failure to disconnect up to five million unregistered SIM cards. The NCC has said unregistered SIM cards pose a security risk in the country.
Fine’s negative impact
Since the announcement of the $5.2bn Nigerian fine last week Monday, MTN has taken a battering on the JSE with its share price having fallen about 20% from its trading peak of R192.45 on Friday October 23 at 13:30 to a close of R157.80 on October 30.
The mobile network last week also took a knock from ratings agencies, such as Standard & Poor's, which downgraded MTN amid concerns over the fine.Meanwhile, the JSE also confirmed on Friday that it’s “looking into trades” that took place before the company’s Nigeria fine announcement last week Monday to determine if “there is any evidence of possible insider trading”.