Nigeria: FG Considers Liquidation of NITEL

Mergers, Acquisitions and Financial Results

The Federal Government is considering a "guided liquidation" of NITEL now that the reserve bidder, Omen International has failed to pay its $105 million bid security by Friday, June 17.

Answering questions Tuesday in Abuja at the Eminent Speaker Series of the Securities and Exchange Commission (SEC), the Director-General, Bureau of Public Enterprises (BPE), Ms. Bolanle Onagoruwa, said Omen International had asked for an extension of payment deadline until Wednesday this week. However, it failed to meet this extended deadline.

According to Onagoruwa, Omen had made a request for some days of grace till today to credit BPE's account with the said amount. She, however, said the Bureau would yet give Omen up till Friday, even if it failed to pay the bid security by today after which it would consider, among others, the option of a guided liquidation of the telecoms company.

"They (Omen) claimed that it was the elections or their financiers or about the stability of the Nigerian government etc... and said we should give them till the 10th of June to pay. However, the 10th of June was on Friday, as of Friday, they brought in a letter to my office saying that they had transferred the money and that we should expect to receive it in our account by Wednesday. We want to give them up till that Friday to know if the money will come in but we already know what to do if by Wednesday the money is not in," she said, adding that "We have various ideas that we have thought about. One of them is liquidation-what the BPE would call guided liquidation."

Following the repeated failure of the preferred bidder, New Generation, to pay up its $2.5 billion bid offer, the reserve bidder, Omen, was thereafter given the opportunity to assume ownership of the comatose telecommunications company.