Appoints CEO, CFO, New Board To Act For Six Months
The unfolding drama at Etisalat Nigeria continued on Tuesday with the appointment of a new board, led by Joseph Nnanna, deputy governor at the Central Bank of Nigeria as chairman, after regulators stepped in to save the company from collapse.
Reuters reported Etisalat Nigeria’s vice president for regulatory affairs, Ibrahim Dikko, told Reuters, confirmed the development, in addition to Boye Olusanya who takes over as chief executive and Funke Ighodaro, who replaces Olawole Obasunloye as chief financial officer of the franchise, partly owned by UAE group Etisalat.
Other members of the six-man board are Oluseyi Bickersteth, National Senior Partner and Chief Executive Officer, KPMG Professional Services Limited, and Ken Igbokwe, former Country Business Executive Leader of PricewaterHouseCoopers Nigeria and West Africa and was a member of the PwC Africa Executive Committee, now Chairman, Execution Edge Limited.
The CBN and its telecoms industry regulator- the Nigerian Communications Commission (NCC) have intervened to save Etisalat Nigeria from collapse after talks with local banks to renegotiate a $1.2bn loan failed. The banks were under pressure to avoid loan-loss provisions, following which they began pushing to finalise a restructuring of the facility arranged for Etisalat four years ago, before half-yearly financials were due in June.
Both the CBN and NCC say they want to protect Etisalat Nigeria’s 4,000 workers and are seeking to prevent lenders placing the telecoms firm in receivership in order to avoid a wider debt crisis for the firm with a 14% share of Nigeria’s GSM market, behind MTN with 47%, Globacom with 20% and Airtel, 19%.
Following the CBN’s involvement, expectations that the bank could get some forbearance on provisions, pending resolution of the debt crisis or the company is sold to new investors.
The new appointments, which followed Monday’s resignation on Monday of Etisalat Nigeria’s Chief Executive, Matthew Wilsher, days after chairman, Hakeem Belo-Osagie, with 15% stake in the company took a bow.
These are part of a transition process reached by the parties on key issues to ensure the company continues on mutually terms agreed by Etisalat and its club of creditors- 13 Nigerian banks to ensure the company remains a going concern, regardless of changes in the its shareholders.
It was learnt that the CBN, while providing assurances to the lenders, did not invest any funds, just as the minority owner, Abu Dhabi’s Etisalat, indicated intention to pull out of Nigeria, owing to the debt crisis but remains silent on the planned continued use of its brand in Nigeria.
On June 23 the central bank said Abu Dhabi state investment fund Mubadala, which had a 40 percent stake in Etisalat Nigeria, had already pulled out of the company and the debt negotiations.
The 13 Nigerian lenders including Zenith Bank, First Bank, Access Bank, Guaranty Trust and United Bank for Africa, last month initiated changes in Etisalat Nigeria’s shareholding structure to enforce their rights under the loan default agreement. UAE’s Etisalat has said it is carrying its 45% stake in the Nigerian arm at nil value.
A source at the telecoms industry regulator said the new interim board made up of six members will operate for six months and will include a member representing the shareholders.
