After Four Failed Attempts: NATCOM Buys NITEL, M-TEL For $252m In Guided Liquidation

After several failed attempts to sell off the government-owned Nigerian Telecommunications Limited, NITEL, and its mobile arm.M-TEL, the Bureau of Public Enterprises, BPE, Wednesday announced fresh acquisition of the national carrier by a group known as NATCOM.

Director-General of BPE, Benjamin Dikki, explained that NATCOM is a consortium of seven Nigerian companies. It emerged the new owners of NITEL and MTEL by offering to pay $252 million, an amount said to have met the BPE’s bid price.
Dikki explained that the privatisation process was a guided liquidation that would help in bringing back the two entities that had lain waste for over two decades.
According to him, NATCOM emerged the successful bidder in technical and financial commitment from the array of up to 17 firms that keenly contested for the two companies.
He said: “It is our fervent hope and desire this time around we have succeeded in procuring a technically and financially qualified bidder that will not only meet the deadline for payment of the purchase consideration but more importantly deploy the required resources to rehabilitate and grow these companies to play a significant role in the Nigerian telecoms sector.
“We faced numerous challenges in packaging this transaction, including outstanding unpaid terminal benefits of ex-staff of NITEL and M-TEL, arrears of salaries of the retained staff and outsourced security and huge accumulated unpaid licence and other dues to NCC.”

NATCOM beats 15 other bidders
In her address, Minister of Communications Technology, Dr. Omobola Johnson, said the consortium beat 14 other bidders at the primary stage and one other bidder at the secondary stage to emerge winner of the bidding process.
She described the privatisation as the last segment in a well-thought out reform of the Nigerian telecommunications sector, which commenced since year 2000.
The minister noted that the liberalisation of the sector in the last 13 years had attracted new investments of over $32 billion entirely from the private sector, resulting in an explosive impact on the sector with over 130 million subscribers compared to just 400,000 and teledensity of 96.08 per cent from less than 1.8 per cent.
According to her, the emergence of NATCOM as the new buyer of the facilities marked the final emergence of a qualified bidder with the requisite technical expertise and financial resources to transform the two companies in line with the vision of government.

FG assures
Johnson assured that Federal Government would continue to review and fine tune policies that would provide an enabling environment for the growth and development of a private sector-driven Nigerian telecommunications industry.
She also assured that government, through open and consultative dialogue with stakeholders and transparent regulation, government would continue to put in place measures that would further deepen competition, enhance access and coverage and reduce costs to the consumers of destinations.

We are ready to hit the ground, running
Responding, Chairman of NATCOM, Tunde Ayeni, said NATCOM was aware of the importance and value Nigeria attached to both assets in driving the ongoing telecoms revolution in the country, saying that they were ready to hit the ground, running.
He commended BPE for the transparent way it carried out the privatisation process and assured that the consortium would do the needful to revitalise the facility to meet the target of offering Nigerians the opportunity to make choice.
He said: “The process was transparent. We are glad we were able to match the reserve price. The process was very competitive and was not a one-sided affair as some people said.
“We are here to make a change and ready to find the needed funds to turn the facilities around. We are confident of our ability because we have one of the best telecommunication companies in the world as our partner with over many years of experience.
“We have been taken to task and wouldn’t do things by half measures because we have gone round the world to find the money. NITEL requires huge money to turn it around and we have confidence in the sector and promise that we will not disappoint. For us, the journey has started.”
NATCOM Consortium is a special purpose entity set up for the acquisition of NITEL and M-TEL.
It comprises seven local and foreign companies, who came together in the consortium as equity investors and technical partners.

NATCOM gets three-year ultimatum to roll out services
With the successful culmination of the privatisation exercise, and emergence of NATCOM as the winner, BPE said NATCOM is required to roll out services within the next three years and is to make the initial payment of 30 per cent of the total amount within 15 days and the remaining 75 per cent within 90 days.
Although Dikki described the privatisation process as successful and transparent, he also recalled that there had been four unsuccessful attempts to privatise the firms in the past and expressed the hope the new deal, would work.

Author: News Editor

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