MTN Group may lose more high-ranking executives in the next few months, according to sources familiar with the matter, just as the company, Africa’s largest wireless carrier by sales, continues to battle the $10. 134 billion allegation, which is a combination of $2 billion unpaid tax arrears and $8.134 billion alleged funds repatriation out of the country between 2007 and 2015, which the Central Bank of Nigeria (CBN) has asked it to refund to government coffers.
Chief Innovation Officer at MTN Group, Herman Singh, is expected to leave soon and will move on to start his own tech venture, according to close sources who asked not to be mentioned as the information hasn’t been made public. The exit will come as the 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. But Singh has declined to comment.
According to Bloomberg, the executives are leaving after a three-year period of considerable turmoil at MTN. The $5.2 billion fine in Nigeria in 2015 embroiled MTN in 10 months of negotiations and prompted a management overhaul. Earlier this year, authorities in the Nigeria 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, Bloomberg said yesterday.
The shares of MTN Group declined a further 2 per cent yesterday to 88 rand as of 1.13 p.m. in Johannesburg, which is the steepest fall in a week.
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 Limited, 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 Limited. 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 that the company illegally transferred $8.1 34 billion out of the country and owes $2 billion in tax arrears. While the transaction matter looks close to being wrapped up, with Central Bank Governor, of Nigeria (CBN) Mr. Godwin Emefiele, said he was going to “the verge” of announcing an amicable resolution.
Other troubles for MTN include problems extracting cash from Iran, its third-biggest market, after United States President, Donald Trump, reinstated sanctions against the country. The telecoms company 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.