A consortium of foreign and Nigerian banks, including Guaranty Trust Bank, Access Bank and Zenith Bank are set to take over telecommunication giant, Etisalat Nigeria today, Wednesday, over a loan facility totaling $1.72 billion (about N541.8 billion), obtained by the company in 2015.
The Point learnt that take-over is taking place despite efforts by the sector’s regulator, the Nigerian Communication Commission, to broker a peaceful resolution of the issue between Etisalat Nigeria and the consortium of banks, which may have hit the rocks.
The mobile telephone operator and the consortium of some foreign and Nigerian banks, including GTB, Access Bank and Zenith Bank, have been having a running battle over the loan facility which was obtained in 2015.
The loan, with a foreign-backed guaranty bond, was to be used by Etisalat to finance major network rehabilitation and expansion of its operational base in Nigeria.
But, The Point learnt that the failure of the telecoms operator to meet its debt servicing schedule since 2016, led the three Nigerian banks, which were under pressure from their foreign partners, to report Etisalat to the banking industry regulator, the Central Bank of Nigeria and the NCC.
While Etisalat claimed that its inability to fulfil its loan obligation to the banks was as a result of the current economic recession in Nigeria, the banks said the pressure put on them by the Asset Management Company of Nigeria to immediately cut down on the rate of their non-performing loans compelled them to attempt to recover the loan by all means.
A senior official of one of the banks, who spoke on the condition of anonymity, said that one of the options proposed to Etisalat management, as a middle way out of the crisis, was for it to request for a bankruptcy status.
The official, who said he was not authorized to speak on behalf of the consortium of banks, further disclosed that the bankruptcy option would require having receivership management appointed by the banks to oversee its operations.
While the NCC, according to the source, was not favourably disposed to the take-over proposal, as it believes that Etisalat was not only a viable concern, but also willing and able to negotiate its loan servicing, a top NCC source however disclosed that the regulator had approved the take-over, expected to take place today.
Etisalat, which commenced business in 2009, is Nigeria’s fourth largest telecoms operator, with a subscriber base of about 21 million as at January, according to statistics released by the NCC.
