Sudatel to Buy 70 Percent Stake in Nigerian company Intercellular
Sudan Telecommunications Company (Sudatel), the national telecoms company of Sudan is to buy 70 per cent share of Intercellular, one of Nigeria's leading privately owned telecoms operator in yet another major take-over in the nation's fast-growth telecom sector, Technology Times confirmed.
El-Rufai had hitherto hinted that Intercellular was in talks with an undisclosed foreign operator hoped to inject no less than $150 million and was quoted in a recent interview with Sunday Trust where he admits that previous talks with Telecel to take stakes in Intercellular fell through as "they backed out due to some of the terms and conditions of the agreement."
Sudatel, which flagged off as a regional carrier in 1994, also has capital investors are from eight countries including Saudi Arabia, Emirates, Qatar, Yemen, Bahrain, Iran, Sultanate Oman, Jordan, and 14 local and regional banks and 80 local and foreign companies.
Sudatel also has stakes in Arab Cables (40%), Thurya Mobile Phone Service, Rascom, Sudanet (51%), Datanet (99%), Hawatif Corporation, among others.
Sources in the know confirmed that the two companies will announce the new deal early next year as Sudatel follows the footsteps of fellow Arabian operators that have lately entered the Nigerian telecoms market to consolidate their international expansion into emerging markets.
According to el-Rufai, local operators face a huge challenge from securing long term loans to drive their growth in the face of stiffer competition from the bigger GSM operators.
"So for us, the best thing to do was to look for equity. I have run around our community (the north), because we are a northern company with 98 percent northern shareholding. But this equity has not been forth coming. We have tried through state governments and other individuals and it’s been difficult. They have not been willing to invest. As a result, we have recorded not quite an impressive success. The result is that today, our equity is only $16million and there is no way you can run telecom with a meagre amount of $16million when you compare with our other immediate competitors like Multi-links, Starcomms and so on.
"Some of them have 10 times the equity we have. So it’s been very difficult for us. We made efforts to get foreign investments but you know the problems of Nigeria like the country risk and other infrastructural problems. All these discouraged the investors. But I am glad now that we have two serious interested companies that we are talking to. One is a Nigerian company and one is a foreign one and I hope that we are going to close the deal so that quite lot of money will come into the company and this will coincide with the issuance of unified licence which we have. We can now do full mobile like MTN and others. We have made our plans and by God’s grace within a month we should be able to close and then bring in a strategic investor who will bring a lot of money so that we can rapidly expand and introduce new services like broadband so that we increase internet penetration and introduce other data services."
On how the company started after the were sacked from Nitel, he says, "we started this company with a share capital of N200million. It was not easy, but when we were sacked there were a lot of Nigerians that sympathised with us because the peak of NITEL growth was during our time. So they contributed money and then Hakeem Bello Osagie, the then Chairman of UBA said he was going to assist us so he gave us a loan. Motorolla as an organisation, at that time, was doing all it could to break into the Nigerian market but they couldn’t. So they sympathised with us and came to our aid by giving us vendor financing. So we started."