MTN Group says US-Iran sanctions could tie down EUR120 million

MTN Group says US-Iran sanctions could tie down EUR120 million

South Africa’s MTN Group said about $120 million of its cash could be tied down in Iran as a result of new US sanctions.

It would be recalled that President Donald Trump had pulled out of the Joint Comprehensive Plan of Action (JCPOA).

The company said in a statement that:

“On 8 May 2018 the US announced its decision to withdraw from the Joint Comprehensive Plan of Action (JCPOA) agreement and to re-impose economic sanctions against Iran. These sanctions may limit the ability of MTN to repatriate cash, both dividends and loans, from MTN Irancell. We will continue to monitor the situation including the response of the Iranian authorities and the other JCPOA members.

During 2018 MTN Group has repatriated approximately EUR88 million from MTN Irancell including EUR61 million relating to the full 2017 dividend due to MTN as well as a further EUR27 million of historic dividends. The remaining balance due to MTN is approximately IRR10 000 billion (approximately EUR200 million).

MTN remains committed to their investment in Irancell and to repatriating the balance of legacy cash in Iran whilst remaining compliant with appropriate legislation,” the statement said.

MTN Group is the second largest mobile carrier in South Africa and the largest in Africa’s biggest economy, Nigeria.

The company is preparing for an initial public offering in Nigeria to sell up to 30% o its equity to local investors as part of the deal when it renegotiated a regulatory fine down to N330 billion.