Regulatory Approval Delays Teleologyâ€™s Final Payment for 9Mobile
With barely two weeks to the deadline given Teleology Holdings to pay the balance of $251 million to acquire 9mobile, the company is said to be ready to make the payment, but still waiting for regulatory approval from the Nigerian Communications Commission (NCC) and the Security and Exchange Commission (SEC).
Although it was speculated Tuesday that Teleology might have paid in order to beat the remaining two weeks deadline, but sources close to Teleology Holdings told THISDAY Tuesday night that the $251 million was ready for payment, but kept in an escrow account, awaiting regulatory approval from NCC and SEC.
NCC had said it would carry out due diligence on Teleology Holdings to ascertain its financial strength and technical capabilities to take over 9mobile before it would approve the use of 9mobile licence by it.
As at press time, NCC is yet to release its findings on the due diligence it carried out on Teleology Holdings.
Efforts to reach NCC officials Tuesday night to clarify the status of the transaction were fruitless as they were said to be away in Geneva on assignment at the International Telecommunications Union (ITU) headquarters.
Barclays Africa, the Financial Adviser handling the sale of 9mobile, had in February 21, 2018, announced Teleology Holdings Limited as the preferred bidder for the sale of 9mobile and Smile Telecoms Holding as the reserve bidder.
In a letter transmitted to both operators, Barclays Africa directed Teleology to make an initial non-refundable cash deposit of $50 million within 21 days, which expired on March 21, 2018, and then pay the balance of $251 million within 90 days from March 21, which will expire July 25, barely two weeks from today.
Having met the initial $50 million payment deadline, telecoms operators are optimistic that Teleology will also meet up with the next deadline payment for the balance fee and take full control of 9mobile.
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.
But for want of network expansion, the telecoms company in 2013 approached a consortium of 13 local banks for a loan of $1.2 billion for network upgrade and expansion.
However, citing economic downturn of 2015-2016 and naira devaluation, which negatively impacted on the dollar-denominated component of the loan, 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-appointed Non-executive Directors (NEDs), all nationals of the United Arab Emirates, who resigned their appointments.
Shortly after that, came the resignation of the former board chairman, Mr. Hakeem Bello-Osagie, who is a Nigerian.
This was again followed by the resignation of the then CEO, Mr. Mathew Willsher, and several management staff of the telecoms company, before the decision to sell 9mobile to core investor came up, and Teleology Holdings Limited emerged the preferred bidder, among 16 telecoms operators from within and outside Nigeria that initially indicated their interests to buy and invest in 9mobile.