MTN pays Nigerian regulator $94.2m for operating licence renewal. The same regulator expects $5.2bn by Nov. 16

MTN Group Ltd.’s operating spectrum in the 900 MHz and 1800 MHz frequency bands has been renewed by the Nigeria Communications Commission (NCC) at a cost of 94.2 million dollars amid fears the telco’s operations will be shut down over a $5.2 billion fine slapped on it by the regulator.

MTN’s operating spectrum and digital mobile licence were issued in 2001, and both were due to expire in February 2016. They have now been extended to August 31, 2021.

“We view this extension as a demonstration of confidence in MTN’s capacity to continue to provide ground-breaking and innovative services to its customers,” MTN’s corporate affairs executive, Akinwale Goodluck, said in a statement.

With the licence extension now sealed, MTN is working to ensure it meets NCC’s November 16 deadline for payment of the fine.

The regulatory body had penalised South Africa’s MTN for failing to block unregistered SIM cards before the deadline given by NCC. But with the penalty doubling MTN’s annual group profits ($2.69bn after tax) and 22 percent of Nigeria’s annual budget, the South African company may find it hard to pay up. The company is, therefore, doing its best to reduce it.

“MTN is pushing to reduce the fine by 60 percent to 80 percent,” Adesoji Solanke, Renaissance Capital’s head of research in Nigeria, said in a note to clients on Wednesday, citing a bank. A second lender said that “MTN is considering borrowing from banks, as it recently checked what the banks’ lending capacity to it is,” Bloomberg quoted the analyst to have said.

Although NCC is not giving much out to journalists about the matter, the regulator is expected to reduce the fine in time for MTN to be able to pay.