Nigeria’s tax authority agreed to an out-of-court settlement with MultiChoice Group Ltd., Africa’s biggest pay-TV provider, over a $4.4 billion tax dispute.
The South African company will withdraw all pending lawsuits and the Federal Inland Revenue Service will conduct a forensic audit of MultiChoice’s accounts to determine the company’s tax liability, the Abuja-based authority said in a statement on Wednesday. It didn’t provide details of the settlement.
MultiChoice went to court last year to challenge the penalty imposed by the tax authority, which said the owner of the DSTV service skipped taxes and denied auditors access to its servers.
The dispute was the latest between Nigeria and South African firms operating in the country, though previously the primary target has been wireless carrier MTN Group Ltd.
Johannesburg-based MTN paid a more than $1 billion fine and agreed to list its Nigerian operation in Lagos following a dispute over cancelling subscriptions of people without proper registrations in 2016, though fended off fines over tax and the repatriation of funds in later years.
MultiChoice’s shares have held up over the eight months since the initial tax claim, gaining 9.2% over the period. They rose 2.1% by the close in Johannesburg on Wednesday, valuing the company at R54 billion ($3.6 billion).