After three days of horse trading and negotiations, Etisalat Nigeria was saved from imminent takeover.
The Nigerian Communications Commission (NCC) and the Central Bank of Nigeria (CBN) waded into the matter to help Etisalat Nigeria plead with creditor banks to shelve their takeover plans.
Spokesman for the NCC, Tony Ojobo said:
“Friday’s meeting succeeded in halting the attempt by Etisalat’s creditors at bringing it under any form of take ove”.
”Receivership was completely taken off the table in a meeting that was very productive and constructive”.
”The meeting, which held at the CBN office in Lagos, had the consortium of banks being owed and Etisalat in attendance. The banks and the mobile network operator agreed to concrete actions that will bring all parties closest to a resolution,”
”A meeting will hold on March 16 to agree on a payment restructuring path going forward. ”The NCC will lead the CBN in a possible crucial meeting with Etisalat’s shareholders anytime soon”, he said.
Etisalat Nigeria is heavily indebted to a consortium of local and international banks to the tune of USD1.72 billion. Several restructuring of the loan was said to have failed. Affected banks said they fear the loan might become more toxic which will harm their existence.
Access Bank Plc confirmed last Thursday that it’s share of the loan was up to USD131 million. The bank’s impairment charges went up beyond analyst estimates. GTBank and Zenith Bank were all affected by the pile of such loans in their books. In its 2016 full year result released late last week, GTBank disclosed it booked over 400% increase in impairment charges year on year.
Etisalat Nigeria is partly owned by Etisalat UAE. The company owns 40% stake in the Nigerian unit with about 23 million subscribers.
Part of the proposal of the banks is that Etisalat UAE converts the debt into equity to pay off the debt. The next coming weeks will bring clarity to the future of Nigeria’s fourth largest mobile carrier.