After fourteen years and five failed attempts to sell the Nigerian Telecommunications Limited, the Federal Government on Tuesday finally handed over the beleaguered first national telecommunications company to new core investor, NATCOM Consortium.
At a ceremony attended by notable persons in the privatisation circle, the Bureau of Public Enterprises handed over instruments of ownership and licences of operation to the Chairman of the NATCOM Consortium, Mr. Tunde Ayeni, who said over $1bn was required to revive the company.
Speaking at the ceremony, Vice President Namadi Sambo, who chairs the National Council on Privatisation said the formal handover was a clear indication that where there is focus and determination, there is a way.
Sambo who was represented by a member of the technical committee of NCP, Mr. Emmanuel Amadi, listed the several failures in the past and added that the success at this time was a reflection of the determination of the NCP and the BPE to increase competition in the telecommunications industry.
He said, “It was the realisation that Nigeria will not attain the desired economic growth without adequate reforms and liberalisation of the telecommunications sector that informed commencement of the telecoms sector reforms in 2001.
“These led to the attempted privatisation of NITEL and M-Tel through strategic/core investor sale to Investors International London Limited. Unfortunately, that flagship transaction failed as the preferred bidder could not meet the deadline for the payment of the purchase consideration.”
He continued, “Failure of first strategic investor sale led to the execution of a management contract with Pentascope in 2005. The management contract did not improve the operational and financial position of NITEL and M-Tel and was terminated.
“Orascom Telecoms emerged the highest bidder with $256m during the second privatisation attempt. Its bid was however rejected by the Federal Government as it was below the reserve price.”
NCP in 2006 adopted the ‘willing buyer-willing seller’ strategy. The strategy which threw up Transnational Corporation as the core investor was adopted to shorten the transaction period since the financial position of NITEL was deteriorating.
Following the inability of Transcorp to turn around the fortunes of NITEL, the NCP on June 1, 2009 revoked the sale of the telecommunications company and its mobile subsidiary.
In another strategic/core investor sale in 2011, both New Generation Communications Limited and Omen International Limited that emerged preferred and reserve bidders could not pay the purchase price and the transaction had to be cancelled again.
Consequently, NCP approved the privatisation of NITEL and M-Tel through guided liquidation. It also on November 11, 2013 approved the appointment of Chief Olutola Senbore as the liquidator of NITEL/M-Tel.
At the financial bid opening on December 3, 2014, NATCOM emerged the preferred bidder with an offer of $252.25m bid price.
NATTAG which had been prequalified by BPE to participate in the process was disqualified as a result of the failure of the company to include a $10m bid bond as had been prescribed in Request for Proposal document.
Speaking at the handover ceremony, Ayeni said immense gaps and opportunities still exist in the Nigerian telecommunications market despite the competition in the industry.
According to him, with a good team of investors and management, NATCOM was ready to make the difference required to succeed. He indicated that the company would roll out services soon after rebranding.