MultiChoice Records More Shares After Settling Tax Dispute With Nigerian Authorities
South Africa’s MultiChoice Group, one of Africa’s leading entertainment companies, saw its shares rise on Thursday after reaching a $4.4 billion settlement agreement with Nigerian authorities.
According to Bloomberg, MultiChoice has agreed to drop all pending lawsuits against Nigeria, following a long-running feud over an alleged breach of agreements and denying officials access to its records for auditing.
“According to the terms of the agreement, MultiChoice will withdraw all pending lawsuits, and Firs will resume a forensic systems audit of MultiChoice accounts on Tuesday, 8 March to determine the company’s tax liability,” MultiChoice said.
“With the agreement and the resumption of the forensic systems audit, it is anticipated that the matters will be resolved expeditiously, and shareholders will be kept informed of progress,” the company added.
According to Bloomberg, MultiChoice’s shares have gained 9.2 percent in the eight months since the initial tax claim, and they have since risen 2.1 percent by the close in Johannesburg on Wednesday, valuing the company at R54 billion ($3.6 billion).
Last year, the Federal Inland Revenue Service (FIRS) ordered banks to freeze MultiChoice’s bank accounts and recover $4.4 billion for alleged breach of contract.
MultiChoice filed an appeal and paid a deposit of $19.4 million toward the claim, which it insisted was not an admission of guilt. According to News24, the company maintained that it had always operated legally in Nigeria.
According to Bloomberg, this was one of many disagreements between Nigerian authorities and South African firms. MTN, based in Johannesburg, reportedly paid a $1 billion fine and agreed to list its Nigerian operation in Lagos following a dispute in 2016 over canceling subscriptions of people who did not have proper registrations.
