Fidelity bank banner Bayelsa State banner
Africa’s largest money manager raises alarm over ‘excessive’ payment to former MTN boss

By News Express on 27/04/2016

Share on facebook Yahoo mail icon Gmail icon Share on Google+

Views: 1,996

The Public Investment Corporation (PIC), Africa’s largest money manager, described as “excessive” a payment made to former MTN Group CEO Sifiso Dabengwa, who resigned after a record Nigerian fine.

“PIC has communicated to MTN management its strong opposition to what we see as gross misuse of shareholder funds,” the fund manager said on Monday. “Management and the board of MTN should be held accountable for actions taken under their watch.”

Mr Dabengwa’s R23.7m payout equated to almost three years’ basic salary and took his total 2015 remuneration to R40.6m, MTN said in the company’s annual report published on Monday.

Michael Ikpoki, the former head of the operator’s Nigeria unit, who also left after Nigerian regulators imposed the $5.2bn penalty, was awarded R17.3m in compensation.

MTN’s share price has declined 25% since the fine — later reduced to $3.9bn — was made public in October.

The PIC, which manages the bulk of the government’s pension fund money, is MTN’s biggest shareholder with a 13% stake in the company, according to data compiled by Bloomberg. It has almost R2-trillion in assets under management.

The two executives were rewarded even after they resigned to take responsibility for the Nigerian penalty, which equates to about three years of MTN’s earnings before interest, taxes, depreciation and amortisation (ebitda) in the country. The penalty was imposed on the company for missing a deadline to disconnect 5.1-million subscribers that the government had deemed to be unregistered in Nigeria, which is tightening security as it battles an Islamist insurgency.

Phuthuma Nhleko, the former CEO who returned as executive chairman to resolve the Nigerian crisis after Mr Dabengwa resigned, was paid R5m for work from November 9 until the end of the year. His contract runs until May 9, indicating a total payout of R17.5m for six months’ work. He may also be due a bonus when his contract expires, according to the annual report. The company expects to name a new CEO by the end of June.

MTN and Mr Nhleko have yet to settle the fine, despite hiring former US attorney-general Eric Holder to represent the company and making a 50-billion naira ($251m) down payment. In March, the wireless operator proposed a $1.5bn package that included cash, government access to its wireless network and an offer to buy Nigerian sovereign debt. While the offer had not been formally rejected, negotiations were not currently under way, Nigerian Communications Minister Adebayo Shittu said on April 20.

MTN shares fell 2.6% to R143.59 on the JSE, its biggest decline in almost three weeks, valuing the company at R265bn.

“I am sure shareholders are not happy to pay out exorbitant golden parachutes to management that were asked to leave because they were incompetent,” said Michael Treherne, a money manager at Vestact, which holds MTN stock.

However, the payout to Mr Dabengwa may be the cheapest option if Mr Nhleko could resolve the fine in MTN’s favour, he said.

Nigeria is the biggest of MTN’s 22 markets across Africa and the Middle East, with about 61-million subscribers.

•Sourced from Bloomberg. Photo shows former MTN Group CEO Sifiso Dabengwa.

Source News Express

Posted 27/04/2016 8:41:04 PM


Share on facebook Yahoo mail icon Gmail icon Share on Google+




You may also like...
The Left and Nigeria’s 2019 election, By Edwin...

Dakuku Peterside celebrates Magnus Abe’s senatorial election victory,...

Kano State Government sues musician over song praising...

Air Force holds medical outreach for Borno IDPs...

N671m APC funds vanish into private accounts

Normalcy returns to Code of Conduct Bureau as...

LG congress: Rivers APC unveils list of successful...

BREAKING NEWS: Oil workers call off strike •Union...

European development bank eyes Africa for next wave...

It will be a cloudy day, with localised...

Court told of how ex-Gov. Ohakim paid N270m...

West and Central Africa left behind in Global...


Latest News Operation Python Dance: IPOB discovers site where slain members were secretly buried •Alerts International Community Woman collapses at Benin Airport while awaiting Atiku We are working with some PDP Senators to remove Saraki — APC Kidnapper dies from drug taken at crime scene Army uncovers Boko Haram recruitment link on social media Nigeria’s democracy must not fail, Turaki warns Nigeria ranked among dangerous countries for aid workers How Kwankwaso stashed Kano's $1million in Ukraine — Ganduje Food insecurity: 3.7m Nigerians in danger– Sen. Abdullahi Bayelsa community bemoans distortion of creeks near Shell’s oilfields Alleged contempt: Court insists IGP must arrest INEC boss 500 PDP members defect to APC in Jigawa


Most Read NUDE PHOTO OF OMOTOLA JALADE-EKEINDE surfaces online (376,542 views) Nigerian female sex addict opens up, says ‘I like it with both men and women’ (365,943 views) Shameless Genevieve Nnaji exposes breasts in public (295,640 views) Finally named: The full list of friends of Nigerian female sex addict who prowled Facebook (241,384 views) OLUMBA OLUMBA OBU (the one who called himself God) IS DEAD (221,975 views) Igbo scholar disgraces Femi Fani-Kayode •Demolishes claims on Igbo/Yoruba history with facts and figures (216,805 views) Breaking News: POPULAR REVEREND CONVERTS TO ISLAM in Kaduna (Nigeria) (192,119 views) OBJ’s son reported dead in Lagos plane crash •Names of more victims emerge (174,281 views) THE FINAL DISGRACE: Igbo scholar unleashes more facts about Igbo/Yoruba history, finishes off Femi Fani-Kayode with second article (159,383 views) My wasted years in Olumba Olumba Obu’s Evil Brotherhood (157,831 views) Lagos plane crash: Journalist releases victims’ names (152,334 views) Gunmen kill ASP, 2 other police officers in vain bid to kidnap Rivers PDP chieftain (142,745 views)


Categories Advertorials (3) African Press Organisation (81) Art & Literature (56) Business & Economy (3,445) Business Verdict (48) Columnists (907) Complaints & Requests (95) Enterprise & Opportunities (207) Entertainment (526) Features (632) Global Business Monitor (294) International (2,265) Interview (161) Live Commentary (28) Love Matters (134) News (37,998) Opinion (1,056) Pidgin (11) Politics (6,031) Religion (814) Sports (1,643) Stock Watch (33) AMA & Al Jazeera Global Update


CBN banner

Firstmobile banner




Liverpool Destroying West Ham 4-0 - Highlights


APO Group Partner




GOCOP Accredited Member

GOCOP Accredited member



Africa Media Agency and Al Jazeera