A top delegation of Mubadala Development Company of United Arab Emirates, one of the three major shareholders of Etisalat Nigeria, has arrived Nigeria, in an apparent move to stave off the takeover of the mobile phone company by local creditor banks.
Invoking the local equivalent of the principle of too-big-to-fail, the Nigerian Communications Commission (NCC), the telecoms industry regulator had co-opted its banking sector regulator, the Central Bank of Nigeria, to wade into the debt issue between Etisalat Nigeria and the affected banks.
Etisalat Nigeria ownership is split among three owners including Etisalat, the UEA mobile phone group (40%); Mubadala Development Company, the state-owned owned investment vehicle of the government of Abu Dhabi, in the United Arab Emirates (30%) and Emerging Markets Telecommunications Services, EMTS (30%), promoted by Nigerian businessman, Hakeem Belo-Osagie, who is also Chairman of Etisalat Nigeria.
“Invoking the local equivalent of the principle of too-big-to-fail, the Nigerian Communications Commission (NCC), the telecoms industry regulator had co-opted its banking sector regulator, the Central Bank of Nigeria, to wade into the debt issue between Etisalat Nigeria and the affected banks.”
The Mubadala teamEtisalat, led by its Group Deputy CEO, Waleed al-Muhain which is Nigeria and believed to be in talk to stave off the takeover of its Nigerian business unit, Etisalat Nigeria, by creditor banks in the country reportedly totaling N541.8 billion, according to a report by Premium Times.
Etisalat Nigeria and the three creditor banks made up of a consortium of some foreign and Nigerian banks, including Guaranty Trust Bank, Access Bank and Zenith Bank, are locked in a takeover drama after the mobile phone company allegedly defaulted in repayment obligations for the loan said to have been obtained in 2015.
Meanwhile, the Mubadala team is now in Nigeria, a development that signals indications that the UAE group may have stepped into the local debt impasse of its mobile phone business, Etisalat Nigeria.
NCC also announced via its official Facebook page that the Mubadala team alongside Nigerian Chairman of Etisalat Nigeria, Belo-Osagie and some top official of the mobile phone company paid a courtesy call on the Abuja headquarters of the telecoms regulatory agency.
Details of the talks were not shared in the NCC social media posts of the visit apart from photographs (seen above) showing the visitors at the NCC building.
However, people conversant with details of the talks say that the Mubadala team visited Nigeria to assure the telecoms and banking sector regulators and creditors of Etisalat Nigeria of their interest to resolve the debt impasse.
According to people conversant with situation in the mobile phone company, Mubadala sent its deputy CEO to Nigeria for the meetings not only because he has decision-making authority, but to also reassure the market that the UAE group had not abandoned its local partners, and was keen to resolve the debt issues within the shortest possible time frame.
During his visit to Nigeria, Waleed al-Muhain and his team from Mubadala and local partners are billed to hold talks with NCC, the CBN, HIS, the co-location services provider to Etisalat Nigeria, which is also said to be a major creditor to the mobile phone company, among others, according to our sources.
Etisalat Nigeria, the last entrant among the Big Four GSM networks in Nigeria, rank number four by subscriber base with 19,621,806 active lines representing 12.91% of the market segment at Q1 2017, according to NCC figures. MTN Nigeria, with 60,391,959, accounted for 40.00%; Globacom with 37,328,827, accounted for 24.60% and 34,656,605 accounted for 22.80%, within the same period.
EMTS, the privately-owned Nigerian company behind Etisalat Nigeria is in partnership with Mubadala and Etisalat of UAE, after it acquired the unified access licence from the Federal Government in January 2007, which includes a mobile licence and spectrum in the GSM 1800 and 900 MHZ bands.
UAE’s Etisalat later acquired a 40% stake in EMTS and was subsequently made the operator of the unified access licence and the Nigerian phone business.