Insolvency: Etisalat in fresh trouble

By Odunewu Segun

Etisalat Nigeria may be heading for more trouble over its $1.2bn debt to about 13 Nigerian banks as its parent company, Abu Dhabi-listed Etisalat is said to be considering the sales of its stake in the Nigerian unit, National Daily has gathered

According to sources, Etisalat is keen to resolve the loan issue, and it is just waiting for Etisalat Nigeria debt restructured before it starts the sale process. However, Ahmed Bin Ali, senior vice president at Etisalat, said Etisalat Group does not comment on rumours or market speculation. Etisalat Nigeria could not be reached for comment.

Recall as part of their negotiation, the 13 banks had wanted Etisalat to increase its stake in its Nigerian affiliate in order to reduce the risk of the company pulling out of the country due to the debt issue.

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Meanwhile, Etisalat Nigeria is due to meet with the banks on Tuesday or Wednesday to discuss the loan default, a meeting many sees as a last hope for the embattled telecom company.

Recall that 13 banks, including UBA, Zenith Bank, Access Bank, GTB and 9 other banks last week threatened to take-over Etisalat following its default in making payments on its $1.2bn facility granted by the banks in 2013.

In other to avoid a major crisis in the telecom sector, the Nigerian Communication Commission, NCC, had last week reached out to the Central Bank of Nigeria, CBN, to intervene.

The CBN had then brokered a peace meeting, fencing off the banks pending the outcome of the peace meeting scheduled for either tomorrow or Wednesday between the 13 banks and Etisalat Nigeria.

Etisalat Nigeria signed a $1.2 billion medium-term facility with 13 Nigerian banks in 2013, which it used to refinance an existing $650 million loan and fund a modernisation of its network.

At current official rate, the loan, without interest stands at N377 billion.