MTN stock rises in SA, as Nigeria’s AGF drop $2 billion tax

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The decision of the Attorney General of the Federation (AGF) and Minister of Justice to drop its $2 billion claim against Nigeria has affected the company’s shares at the stock market.

MTN stock rises in SA, as Nigeria's AGF drop $2 billion tax

Impact on MTN stock: The stocks of MTN Group was positively impacted as it jumped to close 5.3% higher in Johannesburg on Friday, Bloomberg reported.

MTN shares traded at 83.67 rand at the close on Friday, valuing the company at 158 billion rand ($11.1 billion). The case had been a drag on the shares’ movement of the telecommunications company for months.

The decision “paves the way to an orderly and amicable resolution of this matter,” MTN Chief Executive Officer Rob Shuter said in a statement.

He said, “MTN remains fully committed to meeting our fiscal responsibilities and contributing to the social and economic development of Nigeria and all regions where we operate.”

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The share price on the Nigerian Stock Exchange (NSE) a day before the AGF’s decision (last Thursday) closed at N116 and after the market closed on Friday, the stock remained at N116. This is despite the share price rising from N109.50 kobo last Wednesday to close at N116 on Thursday.

What this means: The report of the AGF’s decision to drop its claim against MTN might has boosted investors’ confidence in South Africa but investors in the country where the decision was made were not that inspired or motivated.