Access Bank PLC alongside other Nigerian and foreign banks, has taken over the management of Etisalat Nigeria, effective June 15. The takeover follows
Access Bank PLC alongside other Nigerian and foreign banks, has taken over the management of Etisalat Nigeria, effective June 15. The takeover follows the inability of the Emerging Markets Telecommunications Services, EMTS, promoted by-one time Chairman, United Bank for Africa, UBA, Hakeem Bello-Osagie, to reach an agreement with the banks on the about N541.8billion debt restructuring plan for the company.
However, EMTS Holding BV, an associate of Etisalat Group and established in the Netherlands, has up to June 23 to complete the transfer of 100 per cent of the company’s shares in Etisalat to the United Capital Trustees Limited, the legal representative of the consortium of banks.
Etisalat Group, the parent company of Etisalat Nigeria, announced the takeover on Tuesday in a filing to the Abu Dhabi Securities Exchange in Abu Dhabi, United Arab Emirate. The filing, with reference number Ho/GCFO/152/85, and dated June 20, 2017 signed by Etisalat Group Chief Financial Officber, Serkan Okandan, said efforts by EMTS to restructure the repayment of the syndicated loan by a consortium of banks to Etisalat Nigeria collapsed.
“Accordingly, the Company received a default and security Enforcement Notice on 9 June 2017 requesting EMTS Holding BV (EMTS BV) and through which Etisalat Group holds its interest in 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 said.
Etisalat has been under pressure since 2016, 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.
