Benin grants mobile licence to Nigeria's Globacom

COTONOU, Benin, Aug 13 (Reuters) - Benin granted an operating permit to neighboring Nigeria's second biggest operator Globacom on Monday, a month after cutting off two of its four networks in a dispute over contracts and license fees.

The West African country launched a tender for a new operator after suspending the networks of South African-listed MTN (MTNJ.J) and Atlantique Telecom, controlled by Emirates Telecommunications Corp (Etisalat) (ETEL.AD) last month.

Globacom was selected from some 10 tenders submitted and signed a contract with the government on Monday granting them a 10-year operating license.

Benin's telecom regulator had ordered MTN and Atlantique Telecom to sign new contracts including a $50 million, 500 percent rise in the initial once-off operator fee to 30 billion CFA francs ($61.80 million).

Government officials said Globacom had offered a higher sum to enter the market.

"The financial offer exceeded that which the government is proposing to existing operators," Victor Tokpanou, legal adviser to President Thomas Boni Yayi, told state television on Monday.

With only 8 million people, Benin is a tiny market compared to neighboring Nigeria, Africa's most populous nation with nearly 17 times Benin's population.

MTN, whose Benin network was previously operated by Spacetel Benin under the Areeba brand, had 514,000 subscribers in Benin in March. Atlantique Telecom's Moov network, previously part of the Telecel group, has around 450,000.

Tokpanou said there was still room for negotiations with the two suspended operators.

Government officials say the two operators have asked for tax breaks on imported equipment and proposed to pay the remainder of their license fees over their 10-year lifespan, but the government has rejected the tax breaks and wants them to pay the full license fee up-front.

Benin's other operators Libercom, a subsidiary of state fixed-line company Benin Telecom, and Bell Benin, owned by local businessman Issa Salifou, have accepted the new contracts with the increased license fees, officials said. (Reporting by Samuel Elijah, writing by Alistair Thomson)