Reprieve appears to have come the way of embattled telecoms operator, Etisalat Nigeria, which three Nigerian banks, Wednesday, got approval to take over after it allegedly failed to repay a loan of over N541 billion it secured from them in 2015.
This is after the telecoms regulator, Nigerian Communications Commission, NCC, and its banking sector counterpart, Central Bank of Nigeria, CBN, yesterday, waded into the matter again. The meeting between Executive Vice Chairman of NCC, Prof. Umar Danbatta, the Central Bank Governor, Godwin Emefiele, and their teams, was held at the CBN headquarters in Abuja.
The meeting was said to have been convened by the CBN at the instance of NCC, to further deliberate on how best to stave off the attempt by the banks to take over Etisalat.
It was gathered that at the end of the meeting, CBN agreed to invite Etisalat management and the banks to a meeting today, towards finding an amicable resolution. The NCC, as a regulator of the telecoms industry, had moved quickly to intervene earlier in the week by reaching out to the CBN, convinced of the negative impact such a bank take over will have on the industry.
NCC said it was worried about the fate of the over 20 million Etisalat subscribers and the wrong signals this may send to potential investors in the telecoms industry. The three Nigerian banks owed by Etisalat are Guaranty Trust Bank, Access Bank and Zenith Bank. Despite earlier interventions by the telecom regulator, the banks got approval to take over the telecoms company, effective last Wednesday.
A close source at NCC stated that the commission tried its best to ensure the situation didn’t degenerate to take over of the telecoms company but the pressure from the banks became so intense that it had to allow the action. The source said the issue had lingered for a while, with the NCC believing it could provide some middle ground for both parties to come to a truce but unfortunately, the banks feared that inability to recover the loan could expose them to the Asset Management Company of Nigeria, AMCON, which had been demanding immediate cut down on the rate of their non-performing loans.
The loan facility, totalling $1.72 billion (about N541.8 billion) involving a foreign-backed guaranty bond, was for Etisalat to turn around its network and expand its operations in Nigeria. However, the banks claimed that Etisalat has failed to service the debt as was agreed since 2016. They subsequently reported Etisalat to banking sector regulator, the Central Bank of Nigeria, CBN, and its communications sector counterpart, the NCC.
There were also reports as at Wednesday that Etisalat Nigeria was seriously in talks with local banks to renegotiate the terms of the $1.2 billion loan.
The latest development, may not be far from the strategies it took to avert the embarrassment of being taken over by the banks.
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