The Public Investment Corporation (PIC) built a 26 percent stake in Johannesburg-based MTN by late November and used that to call for the replacement of chairperson Phuthuma Nhleko, people familiar with the matter said. Africa’s biggest fund manager, which is South African state owned, also sent a letter to MTN demanding a board reorganisation, said one of the sources. That resulted in the appointment of more politically connected directors.
Last month, the carrier obliged, announcing Nhleko’s planned departure and replacement, along with other director changes and a new separate group of prominent advisers. The PIC didn’t respond to a request for comment. Nhleko declined to comment. Interactions with the PIC have been at the board level, MTN chief executive Rob Shuter said in London last week. “An important thing for them was on our board evolution,” he said.
The PIC was moved to act following a series of disputes in Nigeria, Iran and elsewhere, the people said, asking not to be identified as the concerns weren’t disclosed publicly. The biggest of those was a $5.2 billion fine in Nigeria in October 2015, which was eventually settled for less than $1bn.
The PIC, which manages the pension funds of South African government workers, wants the new chairperson, former South African deputy finance minister Mcebisi Jonas and the board to resolve outstanding issues such as a $2bn tax dispute in Nigeria, the people said.