The crisis rocking Etisalat Nigeria over their $1.2bn has deepened, as its United Arab Emirates-based largest shareholder, Mubadala Development Company, has pulled out of the telecommunications company. The Abu Dhabi state-investment fund, exited following the inability of Etisalat Nigeria to come to an acceptable agreement with a consortium of 13 banks over the debt leaving only Etisalat Nigeria’s local partners led b y Hakeem Bello-Osagie, to face the banks.

The CBN spokesman, Mr. Isaac Okorafor, in the statement, said the banking sector regulator had, therefore, intervened in the matter to forestall possible job losses and asset striping if the banks. “It was based on the attempt of the banks to move in to take over the company that the financial and telecommunications regulators (CBN and NCC) have moved in to intervene and forestall down-sizing and asset stripping.”

Okorafor said, “Although it should ordinarily not be the role of a regulator to decide how individual bad loans are resolved, the CBN believes that Etisalat is a systemically important telecommunications company with over 20 million subscribers that if not well handled, may have domino effects on the banking system itself.”

He further explained that the CBN and the NCC, sensing that banks might go ahead in the usual way and downsize the company’s over 4,000 staff, reached an agreement to intervene and implored the consortium of banks to reassess its position in dealing with Etisalat. Okorafor explained that the collaborative move by the regulators was aimed at foreclosing the outcome of job loss and asset stripping and to ensure that Etisalat remains in business and is able to pay back the loans.

Etisalat has been embroiled with the consortium banks over the alleged $1.2bn loan. The UAE’s Etisalat (Etisalat Group), with a 45 per cent stake in the Nigerian arm said it had been ordered to transfer its shares to a loan trustee by June 23, after negotiations failed.