BlogIT_Naija
Abridging the DigITal Divide Between 3G World & "Africa's Eco-hub."
Thursday 14 February 2008, 2:17 AM
NITEL/MTel up for grabs. Again!
The Federal Government has embarked on the search for new investors for NITEL and MTel to improve on its dwindling fortunes. In a meeting with Transnational Corporation (Transcorp) last December, government made clear its position to get another investor to salvage the telecom company.
The government said this was to redress the worsening condition of the company, a year after Transcorp took its operations. This decision was contained in a resolution at the end of the meeting made available to the News Agency of Nigeria (NAN) in Abuja yesterday.
The resolution indicated that both parties agreed to divest a percentage of their equity in the company for a new investor. “There is the need for a new core investor who is an industry player with a focus, technical expertise, managerial experience and financial capacity to turn NITEL/Mtel around’’ it stated.
The Federal Government currently owns 49 percent share in the telecom company, while Transcorp controls 51 percent after paying N63-billion (US 500 million dollars) in November 2006.
With this resolution, the government is to relinquish 24 percent of its holding to the new investor and retain 25 percent for divestment to Nigerians. “Transcorp is to relinquish a maximum of 27 percent out of its 51 percent holding to the new operator/investor in order to make up the 51 percent needed to give the core investor majority ownership’’ the resolution said.
It was gathered that the resolution had been sent to President Umaru Yar’ Adua for approval.
Top ministry officials told NAN that the meeting held on December. 17, 2007, was attended by the Ministers of Information and Communication, the Nigeria Communications Commission (NCC), Transcorp and the BPE. Top ministry officials said some investors have already indicated interest in the company.
The officials said the memo to the president entitled “Re: Unmerited Six Months Tolerance of Transcorp’s sloppy Management of NITEL/MTel’’ catalogued about 32 areas that Transcorp did not meet.The officials said Transcorp had failed to meet up with the Post Acquisition Plan of NITEL/ Mtel, which included infusion of N8.9 billion working capital loan to turn around the company.
They said Transcorp had also not met the repayment of N15 billion Interconnection debt to local and international network operators.Transcorp had also not been able to pay four months salary to Nitel workers who had all been on probation for over a year, without promotion or increment.
It identified: “Incessant changes and disagreements between board members and top management in Transcorp as major factor leading to instability in strategy and programme implementation’’ the officials said.For Mtel, the officials said Transcorp had agreed in the Post Acquisition Plan to infuse N6. 3 billion for direct cost, current and outstanding operational expenses as working loan.
When contacted, the Chairman of Transcorp, Ndi Okereke-Onyiuke, told NAN that it was illegal under the subsisting privatisation laws to sell or cede part of the shares until 2009. “We have no plans now to circumvent the privatisation laws which barred us from distorting the current share structure until after three years.“The contending issue now is that we have succeeded in attracting world class telecommunications firms to commit their skills and funds in revamping NITEL,’’ she said.
She said the prevailing circumstances and dynamics of the global telecom industry had compelled Transcorp to seek government permission in altering the status quo. “We are only suggesting some percentage of equity participation by some of the global telecommunications companies that have shown interest in NITEL.” Transcorp feels it is one of the ways to re-invigorate the cash cow potential of the company,’’ Okereke-Onyiuke said.
She also said that they had re-opened discussion with an American based telecommunication company, CISCO, on the nation’s dormant SAT 3 telecommunication satellites. The privatisation process of NITEL
began in 2001, but was halted in 2002 when the then investor, Investors International London Ltd (IIL) failed to meet up with the payment of 90 percent balance of US 1.3 billion.
(Story captured from businessdayonline: http://www.businessdayonline.com/technology/4004.html)
-Dis na Naija!
-doregos
Tributes:
BUSINESSDAY - http://businessdayonline.com
The government said this was to redress the worsening condition of the company, a year after Transcorp took its operations. This decision was contained in a resolution at the end of the meeting made available to the News Agency of Nigeria (NAN) in Abuja yesterday.
The resolution indicated that both parties agreed to divest a percentage of their equity in the company for a new investor. “There is the need for a new core investor who is an industry player with a focus, technical expertise, managerial experience and financial capacity to turn NITEL/Mtel around’’ it stated.
The Federal Government currently owns 49 percent share in the telecom company, while Transcorp controls 51 percent after paying N63-billion (US 500 million dollars) in November 2006.
With this resolution, the government is to relinquish 24 percent of its holding to the new investor and retain 25 percent for divestment to Nigerians. “Transcorp is to relinquish a maximum of 27 percent out of its 51 percent holding to the new operator/investor in order to make up the 51 percent needed to give the core investor majority ownership’’ the resolution said.
It was gathered that the resolution had been sent to President Umaru Yar’ Adua for approval.
Top ministry officials told NAN that the meeting held on December. 17, 2007, was attended by the Ministers of Information and Communication, the Nigeria Communications Commission (NCC), Transcorp and the BPE. Top ministry officials said some investors have already indicated interest in the company.
The officials said the memo to the president entitled “Re: Unmerited Six Months Tolerance of Transcorp’s sloppy Management of NITEL/MTel’’ catalogued about 32 areas that Transcorp did not meet.The officials said Transcorp had failed to meet up with the Post Acquisition Plan of NITEL/ Mtel, which included infusion of N8.9 billion working capital loan to turn around the company.
They said Transcorp had also not met the repayment of N15 billion Interconnection debt to local and international network operators.Transcorp had also not been able to pay four months salary to Nitel workers who had all been on probation for over a year, without promotion or increment.
It identified: “Incessant changes and disagreements between board members and top management in Transcorp as major factor leading to instability in strategy and programme implementation’’ the officials said.For Mtel, the officials said Transcorp had agreed in the Post Acquisition Plan to infuse N6. 3 billion for direct cost, current and outstanding operational expenses as working loan.
When contacted, the Chairman of Transcorp, Ndi Okereke-Onyiuke, told NAN that it was illegal under the subsisting privatisation laws to sell or cede part of the shares until 2009. “We have no plans now to circumvent the privatisation laws which barred us from distorting the current share structure until after three years.“The contending issue now is that we have succeeded in attracting world class telecommunications firms to commit their skills and funds in revamping NITEL,’’ she said.
She said the prevailing circumstances and dynamics of the global telecom industry had compelled Transcorp to seek government permission in altering the status quo. “We are only suggesting some percentage of equity participation by some of the global telecommunications companies that have shown interest in NITEL.” Transcorp feels it is one of the ways to re-invigorate the cash cow potential of the company,’’ Okereke-Onyiuke said.
She also said that they had re-opened discussion with an American based telecommunication company, CISCO, on the nation’s dormant SAT 3 telecommunication satellites. The privatisation process of NITEL
began in 2001, but was halted in 2002 when the then investor, Investors International London Ltd (IIL) failed to meet up with the payment of 90 percent balance of US 1.3 billion.
(Story captured from businessdayonline: http://www.businessdayonline.com/technology/4004.html)
-Dis na Naija!
-doregos
Tributes:
BUSINESSDAY - http://businessdayonline.com
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