The U.S. President Donald Trump on Tuesday decided to pull America out of the Iran nuclear deal signed by former President Obama, thereby reimposing sanctions on the country and delivering on one of his campaign promises. This decision by the American president is threatening to tighten global oil market and it could also affect business deals worth tens of billions of dollars.
Trump’s order stops new contracts immediately and it gives companies with existing Iranian business commitments to take the necessary action within a 90- and 180-day period. This sanction is likely to the Iranian financial sector which includes the Iranian Central Bank, oil industry, shipping sector as well as other economic pressure points.
One of the companies that would be affected by this sanction is MTN, South African and Africa’s largest telecommunications company, because the move is likely to limit the firm’s ability to repatriate its money from MTN Irancell.
MTN has been in talks with the Iranian Central Bank to repatriate about €200 million in legacy cash that is stuck in that country, which it expected to receive by September. According to a statement released by the company, in 2018, it repatriated about 88 million euros ($104.26 million) from MTN Irancell, including 61 million euros relating to the 2017 dividend due to MTN as well as a further 27 million euros of historic dividends.
“We will continue to monitor the situation including the response of the Iranian authorities,” MTN said in a statement.
MTN has been operating in Iran since 2005 and as at the end of 2017, Iran is its second-largest market with 43 million customers.
Following this announcement by Trump, the shares of MTN, which plans to list on the Nigerian Stock Exchange, went down 2.6 percent after earlier falling over 3 percent.