N541.8bn loan: CBN, NCC intervene

• set to meet with banks, Etisalat

Embattled Etisalat Nigeria may be getting respite from being taken over by 13 Nigerian banks as the Executive Vice Chairman of the Nigerian Communications Commission, NCC, Prof. Umar Danbatta has reached out to the Central Bank of Nigeria on how to resolve the issue amicably.

At a meeting this afternoon in Abuja, facilitated by the NCC at the Central Bank Headquarters in Abuja, both the NCC and the CBN deliberated on how best to starve off the attempt by the 13 banks from taking over Etisalat over a N541.8bn loan granted the telecom company in 2013.

At the end of the meeting, the Central Bank of Nigeria agreed to invite Etisalat management and the banks to a meeting tomorrow, Friday, towards finding an amicable resolution.

In a press statement signed by NCC’s Director of Public Affairs, Tony Ojobo,  NCC as a regulator of the telecom industry had moved quickly to intervene earlier in the week by reaching out to the CBN convinced of the negative impact such a bank take over will have on the industry.

“NCC was worried about the fate of the over 20 million Etisalat subscribers and the wrong signals this may send to potential investors in the Telecom industry,” he explained.

Etisalat Nigeria signed a $1.72 billion (about N541.8bn) medium-term facility with 13 Nigerian banks in 2015, which it used to refinance an existing $650 million loan and fund a modernisation of its network.

Banks involved in the loan deal include: Zenith Bank, GT Bank, First Bank, UBA, Fidelity Bank, Access Bank, Ecobank, FCMB, Stanbic IBTC Bank and Union Bank.

According to a source within one of the involved bank, Access Bank’s exposure to Etisalat Nigeria is N40bn ($131m).

Access Bank chief executive Herbert Wigwe told an analysts’ call that Etisalat had converted a shareholder loan to the Nigerian arm to equity to free up cashflows and that it may need to bring in fresh equity.