|
Getting your Trinity Audio player ready...
|
Two weeks after roundly rejecting an offer of five per cent equity in Etisalat Nigeria in lieu of a $1.2 billion trade credit, creditor banks will now takeover the telecommunication firm three days from now, Friday, June 23.
Etisalat Group, the parent company of Etisalat Nigeria, announced the takeover on Tuesday in a filing to the Abu Dhabi Securities Exchange in Abu Dhabi, United Arab Emirate.
The filing, signed by Serkan Okandan, the company’s chief financial officer, said efforts by Emerging Markets Telecommunications Services, (EMTS) to restructure the repayment of the syndicated loan by a consortium of banks to Etisalat Nigeria collapsed. The loan that has proved so troubling for the Telco is a seven-year facility agreed with 13 local banks in 2013 to refinance a $650 million loan and fund expansion of its network.
“Accordingly, the Company received a default and security Enforcement Notice on 9 June 2017 requesting EMTS Holding BV (EMTS BV) established in the Netherlands, and through which Etisalat Group holds its interest in the company) requiring EMTS BV to transfer 100% of its shares in the company to the United Capital Trustees Limited (the Security Trustee”) of the EMTS Lenders by 15 June 2017.
“Subsequently the EMTS Lenders extended the deadline for the share transfer to 5.00 pm Lagos time on 23 June 2017,” the filing said.
Etisalat Nigeria, with over 23 million subscribers on its network, had been in talks with Nigerian banks to restructure the $1.2 billion loan after missing repayments, but those discussions failed to produce an agreement on restructuring the debt. The Telecoms company was also said to be working with Abu Dhabi state investment fund Mubadala, the second-largest shareholder in the business, to resolve debt woes it said were caused by a devaluation of the naira currency.
Etisalat had initially asked lenders to convert the dollar portions of its loans into naira to help it overcome the shortage of hard currency on the interbank market but this was rejected by the lenders.
A number of firms invested aggressively in Nigeria in the era of high oil prices but are struggling to repay loans or keep operating, as the oil producer suffers from a slump in global crude prices that has hammered its revenues, its currency and dollar reserves.
An Etisalat Nigeria spokesman said the company was still in discussions with lenders to find a “non-disruptive” solution.
Etisalat said its financial exposure to Etisalat Nigeria was related to operational services worth 191 million UAE dirhams ($52 million) and that discussions were ongoing with lenders regarding the use of the Etisalat brand.
LOLADE AKINMURELE
