Etisalat has been taken over by a consortium of Nigerian banks (see details)
The filing revealed that a consortium of banks, led by Access Bank, Guaranty Trust Bank (GTB) and Zenith Bank, have effectively taken over the struggling telecom company
Etisalat Nigeria has finally lost the battle over the N541 billion debt which it owed to a consortium of banks, according to a filing by the telco’s parent company on the Abu Dhabi Securities Exchange in Abu Dhabi, United Arab Emirate (UAE).
The filing revealed that a consortium of banks, led by Access Bank, Guaranty Trust Bank (GTB) and Zenith Bank, have effectively taken over the struggling telecom company, Nigeria’s fourth largest network operator.
The filing reads thus: “Further to our announcement dated 12 February, 2017, Emirates Telecommunications Group Company PJSC, “Etisalat Group” would like to inform you that Emerging Markets Telecommunications Services Limited “EMTS” (“the company), established in Nigeria and an associate of Etisalat Group with effective ownership of 45% and 25% ordinary and preference shares respectively, defaulted on a facility agreement with a syndicate of Nigerian banks (“EMTS Lenders”).
“Subsequently, discussions between EMTS and the EMTS Lenders did not produce an agreement on a debt restructuring plan.
“Accordingly, the Company received a default and security Enforcement Notice on 9 June 2017 requesting EMTS Holding BV (EMTS BV) established in the Netherlands, 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.”
Basically, Etisalat’s parent company in the UAE, through Emerging Markets Telecommunications Services Limited (EMTS) Holdings BV [the holding company through which it holds controlling shares in Etisalat Nigeria] has been asked to turn over 100% of Etisalat Nigeria’s shares to United Capital Trustees Limited, the company representing the consortium of banks.
EMTS Holdings BV (which is incorporated in the Netherlands) has until June 23, 2017 to turn over all of Etisalat Nigeria’s shares to United Capital Trustees Limited, the holding company for the consortium of banks.
Etisalat Nigeria has been under pressure over the $1.72 billion (about N541.8 billion) loan since 2016. A few months ago, Pulse Tech reported that the consortium of banks had made a takeover attempt on Etisalat Nigeria.
That takeover attempt had not been successful thanks to the intervention of the Nigeria Communications Commission (NCC) and the Central Bank of Nigeria (CBN), which urged the banks to rethink their position and allow the company renegotiate the terms of the loans.
However, it would seem like those efforts have not yielded the desired results as the shares of the ailing telco have been ordered to be transferred to the consortium of banks through the two holding companies on both sides of the loan facility.
There is no word at the moment on the fate of the roughly 18 million subscribers on the Etisalat network. Pulse Tech will give you more details as they come to light. This is a developing story.