Will the banking crisis in Nigeria affect the sale of Nitel?


The impact of the Central Bank of Nigeria's banking reforms has started taking its toll as the Federal Government agency saddled with the sale of government interests in businesses in Nigeria, Bureau of Public Enterprises, BPE, has found that buyers of some of the companies it has sold cannot raise the money to effect payment .

Disclosing this in Lagos at a session with journalists, the Director-General of the BPE, Dr. Christopher Anyanwu said that because of the crisis in the banking sector, the prefer and reserve bidders for Skypower Aviation Handling Company, SAHCOL have both failed to pay for the company because they could not raise funds from the banks to meet the payment deadline.

In the case of Nitel Dr. Anyanwu said that 13 applications were received at the deadline for receipt of Expressions of Interest from prospective investors for the acquisition of at least 75 per cent equity in Nigerian Telecommunications Limited, NITEL. The companies are Etisalat Nigeria (EMTS); Omen International Limited (BVI); Summit Group; MTI Consortium; Finetek.Com/Ericsson Consortium; MTNL Limited, India; and Globalcom Ltd. Others are MTN Nigeria Communications Limited; Anas Network Services Limited; Telefonica Consortium; Metro PCS Communications Inc; Brymedia (W.A) Limited; and Galaxy Backbone Pic.However, an additional application was received from Conau Limited.

"Following receipt of the proposals, an evaluation committee has been constituted whose mandate is to independently assess the submissions of each consortium in line with the advertisement and the pre-qualification criteria. The consortia that are pre-qualified for the next stage are expected to pay a non-refundable fee of $25,000 for bidding documents and execute the confidentiality and non-disclosure agreement.

"The Nigerian Communications Commission, NCC as part of the evaluation of the prospective bidders, is expected to conduct a lit and proper' test on each bidding consortium to participate in the bidding exercise.

He said that in the advertisement, prospective investors were invited to apply to acquire either at least 75 per cent equity in the entire Nitel conglomerate or a stake in one or several of its components, namely, SAT-3; domestic fixed line telephony; national fibre-optic transmission backbone; CDMA network; MTel (GSM). Preference would be given to bidders who desire to acquire Nitel fixed lines, - transmission backbone, Mtel and SAT-3 components together while those bidding separately for MTel must be ready to make necessary investments to detach MTel from the NITEL networks.

The Bureau has so far received $25,000 for the bidding documents from eight prospective bidders, who have also executed the Confidentiality and Non-Disclosure Agreement with the Bureau

The Data Room for due diligence opened on the 23rd of September and those that have been pre-qualified were given their unique codes to access the virtual data room. Bidding and other transaction documents (including the Information Memoranda and Requests for Proposal) will be given to those that have paid the $25,000 and executed the Confidentiality and Non-Disclosure Agreement," he stated.