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9Mobile Acquisition: All Eyes onÂ TeleologyÂ as Deadline Looms
WithÂ less than aÂ monthÂ to theÂ 90 days window given to Teleology Holdings Limited to pay the balance of $251 million to acquire 9mobile, industry watchers are observing with keen interest, how the deal would go.
Precisely, the deadline for the preferred bidder for 9mobile to make its final payment expiresÂ onÂ July 25.
Barclays Africa, the financial adviser managing the sales of 9mobile hadÂ on February 21, 2018, announced Teleology Holdings Limited,Â promoted by Adrian Wood, the pioneer Chief Executive Officer of MTN Nigeria,Â as the preferred bidder for theÂ ailing telcoÂ and Smile Telecoms HoldingÂ was the reserve bidder.
In a letter transmitted to both operators, Barclays AfricaÂ hadÂ directed Teleology to make an initial non-refundable cash deposit of $50 millionÂ within 21 days, which expired on March 21, 2018, and then pay the balance of $251 millionÂ within 90 days,Â which would alsoÂ expireÂ onÂ July 25.
9mobile, formerly known as Etisalat Nigeria, became the fourth entrant into the GSM space in Nigeria, when it rolled out its commercial services on October 23, 2008.
ButÂ in its drive to expand itsÂ network,Â the telecoms company in 2013, approached a consortium of 13 local banks for a loan of $1.2 billion.Â However, citing economic downturnÂ as well a severe foreign currency crisis that hit the country betweenÂ 2015Â andÂ 2016,Â the former Etisalat Nigeria, fell short of repaying the loan, a situation that compelled the banks to plan possible takeover of the telecoms company.
After failed negotiations between the telecoms company and the banks, Emirates Telecoms Group Company (Etisalat Group), pulled out of the Etisalat shareholding structure, followed by the six Mubadala and Etisalat Group.
However, telecomÂ operatorsÂ under the aegis of the Association of Licenced Telecommunications Operators of Nigeria (ALTON)Â were optimistic that Teleology would beat the deadline.
ALTONâ€™s Chairman, Mr. Gbenga Adebayo,Â who spoke with THISDAY, also expressed confidence thatTeleology wouldÂ add value toÂ 9mobileÂ andÂ Â turn it around for profitabilityÂ .
Adebayo saidÂ hisÂ optimismÂ was because Teleology was able to meet the deadline for the initial $50 million cash deposit, and hasÂ since gone ahead to hire UBS, an international investor to help it raise a $300 million bridge loan from local banks and investors.
â€œWe are confident that Teleology will meet up with the payment of the balance $251 million beforeÂ July 25, having gone this far in the acquisition of 9mobile.
â€œTaking a look at the management structure of Teleology and the calibre of people driving the 9mobile acquisition, we are rest assured that Teleology will bring great value to 9mobile and introduce innovative services that will further boost subscribersâ€™ confidence in the brand, and also help the entire telecoms industry to achieve the 30 per cent broadband penetration before the end of the year,â€ Adebayo said.
The Nigerian CommunicationÂ CommissionÂ and Central Bank of Nigeria had in 2017 appointed an Interim Board and Management to run the affairs of 9mobile, Nigeriaâ€™s most innovative telecommunications company, pending the conclusion of its acquisition by a new owner.