With major banks, including Access Bank, Guaranty Trust Bank and Zenith Bank threatening to take over its operations, following a $1.2bn loan gone bad, Reuters reported Monday plans by owners of Etisalat Nigeria to sell its stake.
This will however come after the debt is restructured; two sources familiar with the deal were quoted as saying.
Etisalat is due to meet with the creditor Nigeria banks on Thursday, March 16, 2017, to discuss the loan default, in a move regulators of the telecommunication and banking industries expect would ensure the company with 23 million subscribers remains in business.
Besides seeking to resolve the loan issue, the company whose parent company is listed on the Abu Dhabi exchange, according to Reuters, is keen on agreeing on payment restructuring terms, while looking for a good price to sell its stake quoting two different sources.
Tony Ojobo, Director, Public Affairs of the Nigerian Communications Commission (NCC), in a statement dated March 10, 2017, said the commission is planning a possible crucial meeting with Etisalat’s shareholders anytime soon.
He noted that a meeting convened by the Central Bank of Nigeria (CBN) and NCC held in Lagos was held to resolve the loan default crisis facing Etisalat, reprieve was secured.
The meeting held at the CBN’s Lagos office and chaired by CBN governor, Godwin Emefiele, attended by the consortium of banks helped to halt attempt by the creditors to takeover Etisalat, just as receivership was completely taken off the table in a meeting that was very productive and constructive.
“The banks and the mobile network operator agreed to concrete actions that will bring all parties closest to a resolution.
“The CBN and NCC were able to secure for Etisalat the necessary oxygen to enable it continue to meet urgent operational expenses,” just as Emefiele was firm in declaring what needed to be done by both parties towards a quick resolution.
The NCC equally made it clear everything necessary must be done to protect the 23 million Etisalat subscribers and the telecom industry to prevent potential investors from developing cold feet.
Etisalat reportedly obtained a $1.72 billion loan from a consortium of foreign and Nigerian banks in 2015 to facilitate reconstruction and expansion of its network operations in Nigeria. The inability to meet payment obligations to the banks, as well as a foreign counterpart, has been blamed on the current recession in Nigeria.