If it were not the Nigerian Communications Commission (NCC) and the Central Bank of Nigeria (CBN), Etisalat, the telecom giant of the United Arab Emirates (UAE) would have been taken over by a consortium of banks some days ago.
The company, which has been in the Nigerian market since 2009, was on the verge of being taken over following a tumultuous time because of its huge debt.
Etisalat is Nigeria’s fourth largest telecommunications operator with about 21 million subscribers as at January 2017.
There was an attempt by a consortium of banks to take over Etisalat, because of its 1.72 billion U.S. dollars debt on March 8.
A consortium of some foreign and Nigerian banks, including Guaranty Trust Bank, Access Bank and Zenith Bank, have been having a running battle with the mobile telephone operator, over a loan facility obtained in 2015.
The banks said their attempt to recover the loan by all means, was fueled by the pressure from the Asset Management Company of Nigeria (AMCON), demanding immediate cut down on the rate of their non-performing loans.
NCC appears not to be favorably disposed to the takeover proposal; as it believed that Etisalat is not only a viable going concern, but also willing and able to negotiate the servicing of its loans.
The loan, which involved a foreign-backed guaranty bond, was for Etisalat to finance a major network rehabilitation and the expansion of its operational base in Nigeria.
However, Etisalat failed to meet its debt servicing schedule, agreed since 2016, for which they were reported to the banking sector regulator, the Central Bank of Nigeria, and its communications sector counterpart, the NCC.
Etisalat was said to have blamed its inability to fulfill its obligation to the banks on the current economic recession in Nigeria.
Tony Ojobo, a spokesperson for NCC, said that both the sector’s regulatory agency and the country’s apex bank got reprieve for Etisalat on the loan default crisis facing the company.
The reprieve came following a meeting convened by CBN and NCC to find a quick resolution to the crisis, he added, noting that the meeting succeeded in halting the attempt by Etisalat’s creditors at bringing it under any form of take over.
Receivership was completely taken off the table in a meeting that was very productive and constructive, he said.
The meeting, held at the CBN office in Lagos, had the consortium of banks being owed and Etisalat in attendance.
The spokesperson said the banks and the mobile network operator agreed to concrete actions that will bring all parties closest to a resolution.
He said apex bank and NCC were able to secure for Etisalat the necessary “oxygen” to enable it continue to meet urgent operational expenses.
Ojobo said CBN Governor, Godwin Emefiele who chaired the meeting, was firm in declaring what needed to be done by both parties towards a quick resolution.
He said NCC equally made it clear that everything necessary must be done to protect the 23 million Etisalat subscribers.
The spokesperson said there was also the need to protect the telecom industry to prevent potential investors from developing cold feet.
According to him, effort has been made to ensure that Etisalat remains in business while the consortium of banks meet their obligations to their customers.
A meeting will be held 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.
Meanwhile, Oluseyi Osuntedo, a spokesperson for the United Arab Emirates (UAE) company dispelled the rumor that banks had taken over the company.
Osuntedo said talks were still ongoing between the banks and the company.
She said the company was not being picketed as rumored by some people, adding that whoever was giving the information was not telling the truth.