Etisalat Nigeria Gets Deadline To Stop Use Of Brand Name
The crisis rocking Etisalat Nigeria deepened Monday with a directive from the Emirates Telecommunications Corporation (ETC), the largest shareholder in the embattled firm, that the Nigerian arm should stop using the brand name within the next three weeks.
The implication is that the new management must decide within the next 21 days on the options before it, which are either an outright sale of the company or merger with an existing operator in the country.
Etisalat, which controls 13 per cent market share in Nigeria, has had a running battle with a consortium of 13 banks since March, after it notified them of its inability to service its $1.2 billion debt in February due to the foreign exchange challenges in the country.
The firm had through its Vice-President, Regulatory & Corporate Affairs, Ibrahim Dikko, three weeks ago, claimed that it had repaid 42 per cent of the loan.
“As at today, we can categorically state that the outstanding loan sum to the consortium (of banks) stands at $227 million and N113 billion, a total of about $574 million if the naira portion is converted to U.S. Dollars. This, in essence, means almost half of the original loan of $1.2 billion, has been repaid.”
The Chief Executive of Etisalat International, Hatem Dowidar, told Reuters that Abu Dhabi’s Etisalat had terminated its management agreement with its Nigerian arm and given the business time to phase out the brand in Nigeria.
Etisalat had been ordered to transfer its shares to a loan trustee after the talks which brought up management changes to the Nigerian arm.
Dowidar said all UAE shareholders of Etisalat Nigeria had exited the company and left the board and management. He said discussions were ongoing with Etisalat Nigeria to provide technical support, adding that it could use the brand for another three-week before phasing it out.
Etisalat had already planned a name change, according to a source, who claimed that there was nothing to worry about on the matter. He said Emirate Telecoms Group, which hitherto had 45 per cent shareholding, had pulled out of the business. Other shareholders in the company are Mubadala Development Company (40 per cent) and Emerging Market Telecommunications Services (EMTs) (15 per cent). While the first two investors are from UAE, the third, which is EMTS, is from Nigeria, led by the former chairman, Hakeem Bello-Osagie.
On the development, the Director of Public Affairs at the Nigerian Communications Commission (NCC), Tony Ojobo, told reporters that the regulator was not aware of such a deadline. “If there is anything like that, Etisalat will need to write the commission officially,” he said.
Besides, there is a report that two telecommunication giants, Orange and Vodafone Groups, are in a race to buy 65 per cent of Etisalat Nigeria, following the pullout of its major shareholders.
An industry source claimed that Africa’s richest man, Alhaji Aliko Dangote, might be nursing the ambition of helping the troubled telecommunications firm by buying up the shares.
