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Decisions, decisions

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Super Contributor
This must be a question all funds managers are asking themselves ? Will MTN be left with permanent damage or is this a buying opportunity if it bottoms out ?
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27 REPLIES 27
Super Contributor
...and the same question applies to VW
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Super Contributor
buying opportunity when it bottoms out...one must ask, why were those subscribers not disconnected, MTN knew what the fine would be if it was imposed....there is more to this. If SHP adn Multichoice gets "shut" down as was promised at one stage, then there may not be a bottom.
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Super Contributor
Let see who blink first...Nigeria or MTN.
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Super Contributor
I didnt follow the details: how many subscribers are we speaking about and what would the estimated average income be for these subscribers? how long would it take MTN to make that money back from not cutting these guys off? but if its in violation of the law they will be forced to cut them and probably get the fine, not?
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Super Contributor
5.1 million unregistered sim cards - I just wonder what the internal MTN stats on those specific SIMs are... i guess not as much as the $1,000 per sim fine. and now they're going to have to disconnect them in any case. I am sure they didnt benefit that much and they say the Nigeria license is up for renewal next year by the NCC.. good luck MTN if you don't comply with them now!
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Not applicable
18 mln unregistered SIM cards out of 38 million total unregistered for all operators
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Super Contributor
Someone said its serious because the terrorists use the cell phones to communicate and thus the masts etc are not blown up....
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Super Contributor
Joys of doing business in high risk environments. That risk has come home to roost.
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main
Not applicable
Recent form would suggest that the MTN share price subscribes to the strong form of the efficient market hypothesis, and hence R147 is a fair price.
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Super Contributor
Agree. I must say I have always warned about investing in MTN because of its involvement in both Iran and Nigeria. Time our Government becomes involved as failure of MTN will affect the collection of much needed tax monies for the fiscus!
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Super Contributor
High risk environment?? Nah more like "high risk management- sloppy , lacking transparency (!!!!)- what other negatives would you like to add? So, if the management stays the same after this shambles = what prevents them from continuing in this substandard vein? Nothing. If the management remains after this - there is more risk to buying the shares...cos they will simply continue in the present vein.
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Super Contributor
The higher the risk the higher the standards shareholders should be able to rely on. You don't take your tennis shoes to the Antarctic. So if you operate in poorly regulated environments - you focus heavily on the steps you need to take to minimize risk - that is good management - and this assumes your value/risk/return assessment indicates you should be there in the first place...
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Valued Contributor
this is why I sold last Monday
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Super Contributor
The history seemingly goes back to circa 2008. A variety of operators got themselves slapped on the knuckels and twice MTN paid the larger component of fines imposed, always at the rate of N200 000 (no change in this tariff). The present fine equates to two years' profit. How long does it take to win this back especially if your license is not renewed?
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Super Contributor
The size of the fine is nothing short of extortion. I mean it is more than their oil revenue.
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Valued Contributor
chatty, license has been renewed
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Super Contributor
subject to regulatory conditions..which means paying up
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Super Contributor
Sorry,bad phrasing - MTN seeks renewal of its operating license at the end of 2016.
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Not applicable
This matter has been a long time coming. MTN Nigeria was given over 3 years to get their subscriber registration in order (this is the same as RICA in SA). Now picture this scenario. MTN Group management sit with dwindling volumes in SA and their number 1 opco (3 times the size of all the others) reports that they have to chop 10% of their subscriber base due to regulations. Group tells Nigeria to bugger off. Nigeria says fine, but the fine will be severe. Group says annual reports are more important. Group eventually realizes they are sitting on a time bomb and send their most senior IT exec to Nigeria to sort out (Jyoti Desai). But still group knows its coming, and would rather report positive subscriber growth - and pray for a miracle in other opcos, and for a lenient NCC. Group are 0 for 3, and these are the people we are wanting investors to put their faith in?
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