To save over 4,000 jobs and asset striping of Etisalat my its bankers over $1.2 billion, the Central Bank of Nigeria (CBN) and the Nigeria Communications Commission (NCC) are intervening in the crisis.
In a statement on Friday, the CVN said, the move is necessary to prevent job losses and asset stripping. Experts say, if Etislat is grounded, the impact on the telecoms industry and the economy will be huge.
A consortium of 13 Nigerian Banks had a syndicated loan of about $1.2 billion to Etisalat, the debt the telecom firm hasn’t been able to completely liquidate in line with agreed terms of the facility. It was based on the attempt of the banks to move in to take over the company that the financial and telecommunications regulators have moved in to intervene and forestall down-sizing and asset stripping.
The CBN Spokesman, Isaac Okorafor said: “Although it should ordinarily not be the role of a regulator to decide how individual bad loans are resolved, the CBN believes that Etisalat is a systemically important telecommunications company with over 20 million subscribers that if not well handled, may have domino effects on the banking system itself.”
He further explained in the stamen that the CBN and NCC, sensing that banks may go ahead in the usual way and downsize the company’s over 4,000 staff, reached an agreement to intervene and implore the consortium of banks to be reassess its position in dealing with Etisalat.
Okorafor explained that the collaborative move by the regulators was aimed at foreclosing the outcome of job loss and asset stripping and to ensure that Etisalat remains in business and is able to pay back the loans.
According to him, the CBN and the NCC, in the coming days, will meet with the syndicate of banks and the HIS, the tower managers and the equipment suppliers, in order to achieve what he termed “a win-win outcome” for all stakeholders.
It will be recalled that Etisalat has been embroiled with a consortium of 13 Nigerian Banks that gave it a facility of about US$1.2 billion, on which the company has been unable to meet its repayment obligations in line with agreed terms of the facility.