MTN Executive Exits Said to Intensify Amid Nigeria Crisis
MTN Executive Exits Said to Intensify Amid Nigeria Crisis
(Bloomberg) -- MTN Group Ltd. is set to lose another high-ranking executive over the next few months, according to people familiar with the matter, as Africa’s largest wireless carrier by sales fights more than $10 billion of claims in its largest market of Nigeria.
Chief Innovation Officer Herman Singh is expected to leave imminently, and will move on to start his own tech venture, said the people, who asked not to be identified as the information hasn’t been made public. The exit will come as Chief Technology Officer Babak Fouladi prepares to join Dutch telecommunications firm KPN NV in a similar role next week.
MTN confirmed Fouladi’s departure, which was announced by Rotterdam-based KPN earlier this month. Singh declined to comment.
The executives are leaving after a three-year period of considerable turmoil at MTN. A shock $5.2 billion fine in Nigeria in 2015 embroiled MTN in 10 months of negotiations and prompted a management overhaul. Then earlier this year, authorities in the West African nation announced another round of multi-billion-dollar demands.
The stock has halved over the period, valuing the carrier at 169 billion rand ($12.2 billion). That’s even as demand for data services in Africa booms and MTN expands in fast-growing services such as mobile money. The company agreed to a partnership with Orange SA last week to ease payments across the continent.
The shares declined a further 2 percent on Tuesday to 88 rand as of 1.13 p.m. in Johannesburg, the steepest fall in a week.
Team Disbands
MTN Chief Executive Officer Rob Shuter was hired from Vodafone Group Plc two years ago in the wake of the first Nigeria penalty, which was eventually settled for about $1 billion. Fouladi was lured from the same company later that year. Singh, formerly with MTN’s crosstown rival Vodacom Group Ltd., was appointed in 2015.
Another high-ranking executive, Stephen Van Coller, left MTN at the end of August to take the helm of technology firm EOH Holdings Ltd. Originally hired as head of mergers and acquisitions, the former investment banker was moved to run digital services before quitting less than two years into his tenure.
MTN’s latest dispute with Nigerian authorities is over an allegation the company illegally transferred $8.1 billion out of the country and owes $2 billion in back taxes. While the transaction matter looks close to being wrapped up, with Central Bank Governor Godwin Emefiele saying he’s on “the verge” of announcing an amicable resolution, the taxation claim is still outstanding.
Other headaches for MTN include problems extracting cash from Iran, its third-biggest market, after U.S. President Donald Trump reinstated sanctions against the country. The carrier has also come under pressure to list country units on local stock exchanges, with Uganda the latest to link a share sale to license renewals.
To contact the reporter on this story: Loni Prinsloo in Johannesburg at lprinsloo3@bloomberg.net
To contact the editors responsible for this story: Rebecca Penty at rpenty@bloomberg.net, ;Antony Sguazzin at asguazzin@bloomberg.net, John Bowker, Thomas Pfeiffer
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