JOHANNESBURG — MTN Group, Africa’s top telecom, is in talks with South African and United States officials about moving money out of its Iran business, as tightening sanctions have prevented it repatriating funds, its chief executive said.
Johannesburg-based MTN, which reported a 14% rise in first-half profit, said on Wednesday a likely devaluation of the Iranian rial — another result of US-led pressure on Tehran — could have a “severe impact” on second-half results.
The mobile operator owns 49% of MTN Irancell, which contributes nearly 10% of its total revenue, but has become an increasing headache, with the potential to tarnish MTN’s image as a post-apartheid success story.
MTN is being sued by rival Turkcell for $4,2 billion in a US court, saying it used bribery and lobbied South Africa to support Tehran’s military in return for a 2005 cellular licence in Iran that was originally awarded to the Turkish firm.
MTN has denied the charges and called Turkcell’s demands “extortionate”.
Chief executive Sifiso Dabengwa told reporters after MTN’s first-half results on Wednesday that it had been unable to take cash out of the business for at least six months.
“There is general acceptance that we should not be punished. US sanctions should not have unintended consequences for non-US companies,” Dabengwa said.
Washington is putting increased pressure on Iran over its nuclear programme and appears to be cracking down on non-US companies with ties to the country.
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New York regulators accused British bank Standard Chartered on Monday of scheming with the Iranian government and hiding $250 billion worth of transactions.
Speaking in Cape Town on Wednesday, US Secretary of State Hillary Clinton called on South Africa to use its long-standing links with Tehran to persuade Iran to reconsider its suspected pursuit of nuclear weapons.
“South Africa can play an even greater role on issues like curbing Iran’s pursuit of nuclear weapons, or preventing nuclear materials from falling into the hands of terrorists,” Clinton said in a speech billed as the centrepiece of her 11-day Africa tour.
