Date Published: 06/13/11

MTN in N966 Million Debt Mess...Defies Arbitration Ruling

MTN Communications Nigeria Limited in currently caught in a N966 million debt mess being payment for services rendered by an indigenous site integrated maintenance firm, Private Network Nigeria(PNN), Limited since 2007.

It was learnt that PNN signed a contract with MTN in 2007 for the management and maintenance of 1000 MTN's base stations in Abuja and Kano.

Pointblanknews.com learnt that business was good until a dispute arose over invoices submitted by PNN . MTN queried what it tagged wrong site classification.PNN was then asked to reverse the invoices pending a joint audit by both companies after which the balance of the invoice would be paid to PNN. When the audit was done it was discovered that PNN was right. It then submitted a variation invoice to MTN for the sum of N452 Million which had already been lost by PNN as at September 2010.

Curiously, MTN stopped all payments For all services already rendered and demanded that PNn returned all the sites under it's management. The refusal of MTN to pay, threes PNN in it's own debt crisis with 56 suppliers of diesel used at the base stations.

Pointblank news.com further learnt that when all avenue to resolve the issue failed, PNN turned to industrial arbitration seeking N 2 Billion. MTN agreed to the process. Both parties jointly appointed Hon. Justice D.F Akinsanya as Sole Administrator

The final award was made on April 20, 2011. According to a copy made available to Pointblanknews.com, the administrator stated " I direct the Respondent (MTN), to pay the sum of N115,000,000 , ( one hundred and fifteen million naira), to the Claimant PNN...The Respondent should pay interest at the rate of 21% per annum from the 1st day of June 2010, till the final liquidation of both the sum of N115,000,000 aNd accrued interest"

" The Claimant is entitled to a refund of the sum of N 100,030,411 and the interest thereon as this sum had been submitted by the Respondent as being due to the Claimant"

" I am of the view that all the funds representing excess diesel supplied the Respondent after RW2's request must be paid to the Claimant ...a simple calculation would reveal what sum is exactly due to the Claimant . I direct that the Respondent and the Claimant should calculate the excess diesel that was consumed"

Adding the diesel calculations , as directed by the Arbitrator, the total amount , due to PNN stands at N966 Million as at May 31, 2011.

But counsel to MTN , Femi Falana has advised his client to disregard the order and appeal despite the fact that both parties agreed in writing to abide by the ruling of the Arbitrator .According to him, " the said final award delivered on the 20 th of April 2011 is presently a subject of litigation before the Lagos State High court in suit No: LD M/492/2011"

Falana in a statement which did not explain why his client has refused to pay up, said " ...prior to the commencement of arbitration , PNN had instituted an action in the High Court of Lagos State against MTN and 57 oil and gas suppliers wherein it claimed the sum of N964,888,985.78 against MTN which is at variance with the sum of N2.9 Billion claimed at arbitration"

The PNN has also dragged the MTN to the National Communications Commission ( NCC), the Presidency and the National Assembly and the Economic and Financial Crime Commission ( EFCC)

According to the PNN chief executive, Abdulrahman Aabiola- Odunowo " MTN's attitude is akin to that demonstrated by some oil companies in the Niger Delta and it must be stopped now before it becomes a Frankenstein monster to us all"