One of Africa's largest telecommunications companies says it will challenge a hefty fine issued by Nigerian authorities.

In a statement, the South Africa-based MTN Group said it will challenge the Nigerian Communications Commission's $3.9 billion fine in the Federal High Court in Lagos.

On Friday, spokesman Chris Maroleng said MTN has valid grounds to contest the commission's power to impose a penalty and the amount demanded.

The commission's spokesman Tony Ojobo told a Nigerian newspaper that they have not yet received a written notice from MTN, but "would meet them" in court.

The commission fined MTN for failing to deactivate 5.2 million unregistered cellphone SIM cards by an August deadline, a matter of national security in Nigeria where law enforcement says cellphones are used in extremist attacks and kidnappings.