MTN NIGERIA TO LIST ON LAGOS STOCK EXCHANGE
Nigeria's largest mobile operator, MTN Nigeria, in a bid to increase local shareholding, is considering going to the capital market within the next one year.
But the board of another mobile operator, M-Tel last week took far reaching decisions to reposition the company by relieving the Chief Executive Officer (CEO), Mr. Aad Loois, of his appointment. The company's board also retired seven general managers.
The MTN Group announced in South Africa after a meeting last night that, in association with its shareholders in MTN Nigeria, it has reached a decision to explore ways of broadening the base of local shareholder participation in MTN Nigeria.
The Chief Corporate Affairs Officer of the Nigerian telecom company, Mrs. Joke Giwa, in a statement confirming the development last night noted that over the next 12 months ways would be explored to achieve the objective. According to her: "over the next 12 months, substantial groundwork will be done to explore various options to achieve this objective."
The statement further disclosed that alternatives under consideration may include a potential listing of MTN Nigeria within the next 12 months, subject to market conditions.
Although no discussions or negotiations have commenced with potential investors, which may lead to a transaction, further announcements are expected to follow as the process unfolds.
"This move reaffirms our commitment to sustainability and good corporate citizenship, which include local empowerment in all our operations," Giwa said in the statement.
In the present shareholding structure of MTN Nigeria, the MTN Group has 72.5 percent, the International Financial Corporation, 3 percent while Nigerian shareholders own 25.5 percent.
Financial analysts said last night that what this amounts to is that the current shareholding would be diluted as more shareholders would invest in the company which is presently seen as a good investment choice.
MTN Nigeria, which reported a subscriber base of 2,176,000 as at the end of June 2004, continues to experience strong demand for its services and a key challenge for the operation lies in accelerating the network roll-out.
According to the statement, several initiatives are already under way to enable MTN Nigeria to meet customer demand, improve network quality and maintain brand and market leadership in an increasingly competitive environment.
These initiatives, MTN stated, include the construction of own transmission backbone and power supply infrastructure, both of which are critical to the roll-out of a quality GSM service.
The company made a profit of N59 billion in the last financial year with a subscriber base of less than two million.
Meanwhile, the board of M-Tel yesterday approved the removal of the company's CEO, Loois.
M-Tel's Chief Technical Officer (CTO), Mr. Wim Westerink, was immediately named the acting CEO pending the appointment of a substantive officer by Pentascope Limited, the Dutch management contractors to M-Tel within one month.
These decisions were high points of a protracted meeting of the company's board in Abuja presided by Chairman of the board, Alhaji Mohammed Lawal Bello.
Loois was appointed by Pentascope in line with the agreement March 8, 2003 between the Dutch company, the Bureau of Public Enterprises (BPE) to manage Nigeria Telecommunications Limited (NITEL)on behalf of the Federal Government to which M-Tel is a subsidiary.
A member of the board present in the meeting who spoke with THISDAY on condition of anonymity disclosed that seven General Managers were also retired by the board. They include Mr. O A. Anifowose, Deputy Chief Technical Officer, Mr. A.O Alalade, General Manager GSM Operation, Mr. C.I. Anyanwu, General Manager Human Resources, A.Z. Mohammed, Deputy General Manager General Services and Logistics, A.D. Umar, General Manager Finance, S.G. Umar, General Manager Sales and Distribution and Mr. E. Ekeocha, General Manager, Tax .
In place of the sacked top management staff, their subordinates who had earlier being interviewed and recommended for promotion to various senior management positions were asked to take over affairs of the various departments.
Letters conveying the board's decisions were served the various officers about 4.30 pm yesterday about two hours after the board meeting by M-Tel's Legal Adviser and Company Secretary.
Trouble started for Loois September 6, when M-Tel board Chairman, Bello wrote the Managing Director of Pentascope complaining about the below average performance of the sacked CEO.
THISDAY learnt that the letter dated September 6, also gave notice for immediate suspension of Loois and his replacement within one month in line with the terms of the existing agreement. Bello in the letter copied to the Minister of Communications, Chief Cornelius Adebayo and Director General of BPE, Dr. Julius Bala, alleged that "the CEO of M-Tel Mr. Aad Loois has individually demonstrably failed to carry out his duties and responsibilities effectively which negates the hopes and aspirations of the management contract agreement thereby directly impeding the performance targets of M-Tel as a GSM operator." It mentioned the flaws against Loois as "managerial incompetence; the penchant for violating the expenditure approval of a Chief Executive Officer as enshrined in the Management Contract Agreement; non-disclosure of vital information to the Board of Directors as required by the management contract agreement" and " the inability to address the epileptic network performance of M-Tel." The letter informed the Managing Director of Pentascope to "take notice that, Mr. Aad Loois is hereby suspended forthwith as the CEO of M-Tel" just as it said the decision was " taken in the overall interest of M-Tel as a going concern." It was learnt the axe fell on the general managers for their involvement in "bitter intrigues and politics" which constituted an impediment to the growth of the GSM operator, the board member explained. "It was a painful decision but very necessary decision we had to take," the source quoted a board member to have said. He said the concern of the Federal Government was to have a virile company that would be attractive to prospective core investors.