BREAKING NEWS: Etisalat Nigeria Taken Over By Access Bank, Others

The management of Etisalat Nigerian  has been taken over by a  consortium of banks, led by Access Bank PLC and other Nigerian and foreign banks.On Tuesday, June 20th, Etisalat Group, the parent company of Etisalat Nigeria, announced the takeover in a filing to the Abu Dhabi Securities Exchange in Abu Dhabi, United Arab Emirate (UAE)..

The takeover followed the collapse of the effort by Emerging Markets Telecommunications Services, EMTS, promoted by one-time Chairman of the United Bank for Africa, UBA, Hakeem Bello-Osagie, to reach an agreementwith the banks on a debt restructuring plan in the protracted $1.72 billion (about N541.8 billion) debt impasse...

However, EMTS Holding BV, established in the Netherlands,has up to June 23 to complete the  transfer of 100 percent of the company’s shares in Etisalat to the United Capital Trustees Limited, the legal representative of the consortium of banks..

The Abu Dhabi filing with reference number Ho/GCFO/152/85, and dated June 20, 2017, signed by Etisalat Group’s Chief Financial Officer, Serkan Okandan, stated that efforts by EMTS to restructure the repayment of the syndicated loan by a consortium of banks to Etisalat Nigeria collapsed,

“Further to our announcement dated 12February, 2017, Emirates telecommunications  Group Company PJSC, “Etisalat Group” would like  to inform you that Emerging Markets Telecommunications Services Limited “EMTS” (“the company), established in Nigeria  and an associate of  Etisalat Group with effective ownership of 45% and 25% ordinary and preference shares respectively, defaulted on a facility agreement with a syndicate of Nigerian banks (“EMTS Lenders”).“Subsequently, discussions between EMTS and the EMTS Lenders did not producean agreement on a debt restructuring  plan.“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 interestin 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 stated.

Since 2016, Etisalat has been under pressure following the demand notice for the recovery of a $1.72 billion (about N541.8 billion) loan facility it obtained from a consortium of banks in 2015.The loan, which involved a foreign-backed guaranty bond, was for the mobile telephone operator to finance a major network rehabilitation and expansion of its operational base in Nigeria..

Unable to meet its debt servicing obligations agreed since 2016, the consortium, prodded by their foreign partners, threatened to take over the company and its assets across the country.But the intervention of the telecom sector regulator, Nigerian Communications Commission, NCC, and its financial sector counterpart, the Central Bank of Nigeria, CBN, persuaded the banks to rethink their threat and give Etisalat a chance to renegotiate the loan’s repayment schedule..

In 2009, Etisalat kicked off operations in Nigeria and as at January  2017, the company was ranked  as Nigeria’s fourth largest telecommunications operator, with about 21 million subscribers..


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