Telecommunications giant MTN Group CEO Sifiso Dabengwa has stepped down with immediate effect as the JSE-listed group faces a multibillion-dollar fine in Nigeria.

Current nonexecutive chairperson Phuthuma Nhleko was appointed executive chairperson for a six-month period while the process to appoint a successor to Dabengwa was under way.

“Due to the most unfortunate prevailing circumstances occurring at MTN Nigeria, I, in the interest of the company and its shareholders, have tendered my resignation with immediate effect," Dabengwa said in a statement on Monday.

In October, MTN was slapped with a $5.2-billion fine by the Nigeria Communications Commission after failing to disconnect subscribers with unregistered SIM cards from it network, a matter Nhleko was now tasked to “proactively” deal with.

“[We] will continue to work with them in addressing the issues around unregistered subscribers as a matter of urgency,” Nhleko said.

Major shareholder, the Public Investment Corporation (PIC) on Monday said it believed more heads should roll over the failure to comply with regulatory requirements in Nigeria.

"In this regard, there still remain questions as to the role of the board of directors, which is charged with exercising fiduciary responsibilities for the benefit of shareholders. In particular, we question the role of the risk and compliance function within MTN," the PIC said in a statement, questioning how the noncompliance could not have been foreseen and mitigated to avoid a penalty and the possible fallout.

According to several earlier newswire reports, MTN failed to disconnect 5.1-million subscribers in August and September, after being given a directive in August by the telecommunications regulator to verify the identity of their subscribers.

While Nhleko assumed the temporary executive responsibility, Alan van Biljon would continue to serve as the lead independent director.

The company requested shareholders to exercise caution when dealing in securities until a further announcement was made in due course.