The Governor of the Central Bank of Nigeria, CBN, Godwin Emefiele, on Tuesday explained that the bank joined the Nigerian Communications Commission, NCC, to intervene in the crisis between a consortium of 13 banks and Etisalat Nigeria to avoid the “dismemberment” of the company, which would have thrown the workers into disarray.
“The fact that there are over 20 million subscribers enjoying Etisalat’s services, it was important we don’t just allow any creditor, who feels advantaged, to take a decision that will hurt important stakeholders and creditors that operate within Etisalat.
“The CBN and NCC observed that the activities and attempt by some creditors were going to lead to the dismemberment of Etisalat. And we thought we could not allow over 20 million subscribers, or over 4,000 direct staff and over 4,000 others indirectly linked to Etisalat to run into disarray, or go astray without services, because something wrong had happened,” Mr. Emefiele said.
Following failure by the telecoms firm to meet its repayment obligations, the banks had moved to recover over $1.2 billion (N377.4 billion) syndicated loan obtained by Etisalat in 2013 to finance a major network rehabilitation, upgrade and expansion of its operational base in Nigeria.
The banks, namely Zenith Bank Plc, Access Bank, Guaranty Trust Bank Plc, First Bank Limited, Fidelity Bank Plc, First City Monument Bank (FCMB), Stanbic IBTC, Ecobank, United Bank for Africa (UBA) Plc and Union Bank of Nigeria Plc, had threatened to take-over the mobile company.
But, after reviewing the crisis, the CBN governor said the bank and the NCC resolved to intervene to save direct and indirect workers of the company reputed to have a subscriber base of over 20 million and revenue base of over N16 billion daily.
“The regulators, namely CBN and NCC, believed the impact of any adverse consequences on Etisalat will affect the lives of these 4,000 people, along with their over 4,000 indirect workers.
“Either one is a creditor or service provider, we said let’s take things easy, so we do not hurt the interest of others in Etisalat,” the CBN governor explained.
The outcome of the intervention, he said, has been positive so far, with Etisalat not only retaining its subscriber base, but also its 4,000 staff and additional 4,000 indirect workers continuing to work.
Besides, he said, the company’s revenue for the month of June, which was the highest, remained stable at N16 billion monthly, contrary to some expectation that it was going to drop drastically, or the subscribers fly off to safety.
He said the regulators were optimistic Etisalat, by its activity and operations, would continue to be strong and its revenue level remained.
So far, he said, an interim board, aided by CBN and NCC, was recently constituted and given a maximum of 180 days to be in place, while company advisers have been appointed to midwife a process for a major investor to intervene and take-over.
He said the regulators were happy with the surge by potential investors who have indicated interest in taking over the company, saying the advisers would soon advertise for the request for proposal, RFP, from interest investors.
“Interested investors will visit the data room and conduct their due diligence. The best applicant will be selected,” he said.
Emerging Markets Telecommunications Services, EMTS Holding BV, owned by former United Bank for Africa, UBA, Chairman, Hakeem Bello-Osagie, is the only shareholder of the company left.
Last week, the company unveiled a new trading name, 9mobile, to succeed Etisalat Nigeria.