MTN’s share price plummeted from R246.02 on 28 April 2015 to an intra-day low of R132.26 on 4 December 2015, a drop which saw the company’s market cap decline from R454 billion to R244 billion.
One of the major reasons for the share price decline was a N1.04 trillion (around R75 billion) fine in Nigeria, which has since been reduced to N780 billion (around R56 billion).
However, this is not the only reason for the share price drop. Tough market conditions and a weaker Naira saw the MTN share price decline from a high of R246 to R190 before news of the fine broke.
The massive drop in the share price, and the poor way in which the Nigerian fine was handled, claimed some victims.
After the news of the fine reduction, MTN said executive chairman Phuthuma Nhleko would “immediately and urgently re-engage with the Nigerian Authorities before responding formally”.
It will, however, take a lot for MTN to win back the trust of the investor community after the debacle in its largest operation.