Telecom giant MTN has called for an extraordinary shareholders’ meeting of New York-listed IHS Towers as it battles the group’s board over voting rights.
MTN, which is Africa’s biggest mobile operator, owns a 26% economic stake and controls 20% of the voting rights.
However, MTN doesn’t have a representative on the IHS board, but its former CEO, Phuthuma Nhleko, is a non-executive director. The second biggest stakeholder in IHS Towers, a French investment company Wendel – which owns 19% – has one representative, Frank Dangeard.
Both firms demand that those holding 10% or more of IHS should get to nominate board members, but this had been dismissed by IHS.
MTN said on Tuesday it has been engaging IHS on corporate governance matters, including on its voting rights, but IHS failed to notify shareholders of its proposal or allow them to vote on it at its annual meeting on June 7.
It said it “strongly believes that IHS has wilfully breached the Shareholders’ Agreement and Articles by failing to notify its shareholders of the proposal and denying its shareholders the opportunity to vote on it at the AGM.”
Consequently, it “requested the IHS board to call an extraordinary general meeting of the IHS shareholders in order to consider the above mentioned proposal, and any other shareholder proposals relating to governance, to which the Group awaits a response. Beyond this, MTN is currently evaluating all its options with the intention to fully enforce the Shareholders’ Agreement and Articles.”
But IHS Towers said on Wednesday it had unanimously determined that the recent shareholder proposal from MTN was “not in the best interests of IHS Towers as a whole or our collective shareholder base”. The group said it declined the request to submit the proposal, which was in accordance with its articles and shareholder agreement.
