MTN makes early gains amid Turkcell clarity
MTN (MTN) made further advances in morning trade on the JSE on Tuesday (March 13, 2012), as investors gained some clarity regarding the mobile operator’s dispute with Turkcell.
By 10.15 am, shares in the group advanced R1.65 or 1.15% to R144.90, having gained R1.25 on Tuesday – this after MTN strongly condemned Turkcell’s attempt to use the threat of a US legal claim to extort money from the group.
It also criticised Turkcell’s refusal to co-operate with the independent investigation that MTN has set up, headed by the eminent British supreme court judge, Lord Hoffmann.
Turkcell had threatened MTN with litigation in the United States, alleging claims of corruption in relation to MTN’s bid to participate in the second mobile phone network in Iran. In 2005, a consortium that included MTN was awarded the licence.
MTN have appointed Lord Hoffmann to lead an independent investigation of the allegations. It said that although it believes there is no legal merit to Turkcell’s claims, and no basis for a US court to consider them, it had sought to obtain Turkcell’s co-operation with the independent investigation.
MTN says that talks with Turkcell have broken down as a result of its extortionate demands for damages, and its threat to start a frivolous lawsuit in the US.
MTN added that it is committed to resolving the issue through Lord Hoffmann’s inquiry.
A local analyst said that on the back of recent positive results, “clarity on the Turkcell dispute can’t hurt”. He noted that Iran accounts for more than 10% of MTN’s revenue, while Irancell – of which MTN has a 49% holding – grew its subscriber base by 16.6% in 2011, to 34.68 million
Last week, MTN Group announced a 9.7% rise in revenue to R121.88 billion, due to sound growth in Nigeria, South Africa and Iran – of 4.1%, 7.7% and 20.1%, respectively.
Group data revenue improved 30.5%, to R8.09 billion, and accounts for 6.6% of overall revenue – with SMS revenue up 14.2%, to R7.5 billion, or 4.1% of total revenue.
Adjusted headline earnings per share (HEPS) increased by 43.2%, to R10.70.
The group declared a final dividend of 476 cents.
Shares in MTN had slipped to as low as R132 in early February after the group announced that it was facing a potential lawsuit from Turkcell over its licence in Iran.
Related Articles
Loading ...