Nigerian Banks Take Over Etisalat Nigeria

The embattled Nigeria’s telecommunication companies, Etisalat has now been taken over by ten major Nigerian lenders.

The lenders include, Zenith Bank, GT Bank, First Bank, UBA, Fidelity Bank, Access Bank, Ecobank, FCMB, Stanbic IBTC Bank and Union Bank.

The take-over came as a result of a futile effort by Emerging Markets Telecommunications Services, EMTS, promoted by-one time Chairman, United Bank for Africa, UBA, Hakeem Bello-Osagie, to reach agreement with the banks on debt restructuring plan in the protracted $1.72 billion (about N541.8 billion) debt impasse.

However, EMTS Holding BV, established in the Netherlands, has up to June 23 to complete the transfer of 100 percent 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 letter filed to the Abu Dhabi Securities Exchange in Abu Dhabi, United Arab Emirate.
The Telecommunication company 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, succeeded in persuading the banks to rethink their threat and give Etisalat a chance to renegotiate the loan’s repayment schedule.

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