By MKPE ABANG
Although the company is still reeling from concerns on how to settle the impasse over the $5.2 billion slammed on it by the Nigeria subsidiary by the Nigerian telecom regulator, the MTN Group has paid its erstwhile Group Chief Executive Officer, Sifiso Dabengwa, R23.7 million (or $1.63 million) for “loss of office” as a result of the fine.
As the crisis over the fine lingered, Dabengwa quit his job, understandably as a sacrifice, as Group CEO.
Details of Dabengwa’s settlement were revealed in MTN’s 2015 Integrated Business Report which says the “loss of office comprises notice pay and a restraint of trade”.
Dabengwa quit MTN on November 11, 2015 having worked with the company since joining it in October 2001.
His resignation came amid the Nigerian Communications Commission (NCC) fining MTN Nigeria $5.2bn for failing to disconnect 5.2 million unregistered subscribers.
The fine resulted in MTN’s share price at the time losing almost a fifth of its value. Dabengwa’s resignation was also shortly followed by MTN Nigeria CEO Michael Ikpoki, as well as the Corporate Services Executive, Akinwale Goodluck, both of who stepped down in December.
Industry watchers are already asking how much the company would pay – or might have paid – Ikpoki and Goodluck.
Following high level negotiations and consultations, the NCC had reduced the fine to $3.9bn but Nigerian lawmakers have remained unconvinced and instead threatened to hike the penalty even further.
For instance, South African President, Jacob Zuma, visited Abuja, Nigeria’s capital, to hold talks with President Muhammadu Buhari, in early March this; the visit was said to have been hurriedly put together to help discuss the MTN’s fine. “President Zuma’s schedule for Q1 2016 did no originally include any visit to Nigeria,” a South African source familiar with the issues at stake, told IT & Telecom Digest.
Amid the fine and Dabengwa’s exit, MTN’s executive chairman for the group, Phuthuma Nhleko has been heading up the company on an interim basis.
“My primary tasks were to resolve the Nigerian fine and appoint a new group CEO,” Nhleko wrote in the 2015 integrated report.
“The latter process is well under way and we expect to identify and name a new group CEO by the end of June 2016,” said Nhleko.
MTN, in the meantime, has been reeling from the fine in Nigeria.
The company in March reported that its basic headline earnings per share for its full financial year declined by 51.4% to 746 cents.
The company said this drop was “largely a result of the Nigerian regulatory fine provision (R9.29bn), which had a 402 cents negative impact on HEPS”.