Barring any hiccups, Nigeria’s fourth largest telecoms firm, 9Mobile is to get a new owner come March as Barclays Africa, the acquisition advisors have confirmed Teleology Holdings Limited as the preferred bidder.
Teleology has a 21-day window for payment of a non-refundable $50m as the deposit. This was learned this week after an official letter was sent to the company confirming its status in the 9Mobile acquisition.
According to sources, the letter dated, 21st of February 2018 also indicates that failure by Teleology Holdings to make the payment within the stipulated period of time will result to automatic forfeiture of the acquisition to Smile Holdings Limited, the reserved bidder.
Although, 10 bidders indicated interest in the company both Teleology and Smile stood tall after the number was later streamlined to five. Both companies bided $500 million and $300 million respectively.
This development may help to rest the controversies that have trailed the acquisition of the troubled telco but Teleology will still have to apply to the Nigerian Communications Commission (NCC) in order to commence the processes for securing the regulatory approvals to give full effect to the transfer as stated in a recent statement by the regulator.
Teleology Holdings Ltd.
Teleology is a private equity firm with an investment portfolio estimated at $11 billion and it’s is being promoted by Adrian Wood, the pioneer Chief Executive Officer (CEO) of MTN Nigeria.
The company became the preferred bidder ahead of Smile with an offer of $500 million while the latter offered $300 million.
Teleology was reportedly set up by some influential investors solely to revive the troubled telco which is currently battling to retain its over 17 million customers and enhance its market share of barely 12 percent
From Etisalat to 9Mobile
Formally Etisalat Nigeria, the operator was re-christened 9mobile after Etisalat UAE pulled out following the financial crisis that rocked the telecoms firm.
The telecoms company had loan of about $1.2bn from a consortium 13 banks in 2013 – Guaranty Trust Bank, Access Bank, Zenith Bank, UBA, Fidelity Bank and First Bank, among others to expand its network rollout across the country, but couldn’t service it as a result of FOREX.
This led to a takeover of the firm’s management by the banks which was later resolved by the Nigerian Communications Commission(NCC) and the Central Bank of Nigeria (CBN).
The takeover plan, however, forced Emirates Telecommunications Group, UAE (Etisalat Group) withdrawal of further involvement in the ownership of its Nigerian subsidiary on the 15th of June, 2017. The group was a major shareholder in Etisalat Nigeria, along with United Arab Emirates Sovereign Wealth Fund through Mubadala Development Company, Abu Dhabi with a joint 85 per cent equity in the telecom firm, with Myacinth holding 15 per cent stake through Emerging Markets Telecommunications Services, EMTS Holding BV, owned by former United Bank for Africa, UBA, Chairman, Hakeem Bello-Osagie.
After Etisalat UAE pulled out, a financial truce was brokered by the CBN and NCC with the creditor-banks. The rescue agreement entails getting a transitional management for 9mobile while the regulator seeks new investorsto save the troubled telco.
So far, the embattled telco has lost about four million subscribers to the acquisition process from its initial 21 million subscribers trailing heavily behind MTN, Globacom, and Airtel. The third largest operator, Airtel has over 34 million subscribers. MTN leads with subscribers in excess of 40 million.