African mobile operator MTN said on Tuesday it is working with US authorities to manage compliance with sanctions against Iran, one of its biggest markets.

The telecoms giant is facing a $4.2 billion suit in US courts over allegations by rival Turkcell that it used underhand tactics in acquiring the Iranian licence.

Turkcell says MTN bribed both South African and Iranian officials and asked South Africa to provide weapons to Iran to acquire the permit.

Turkey's largest mobile operator initially won a bid for the licence in 2004. Tehran later backed out of the deal and awarded the business to MTN in 2005.

“MTN is working with the US authorities to manage its compliance with US sanctions against Iran. MTN also continues to retain international legal advisors to assist the group in remaining compliant with applicable EU, US and UN sanctions,” MTN said in a statement ahead of an annual general meeting.

The mobile firm has bought back shares worth 1.36 billion rand ($163 million) in the last three months and says it will keep buying when good opportunities arise. Last year, MTN repurchased shares worth 2.29 billion rand. - Reuters