FG moves to sell NITEL assets

By Etuka Sunday with agency report.

The federal government has concluded plans to sell off Nigeria Telecommunications Limited (NITEL), the appointed liquidator has said yesterday in an advert placement.

Reuters reports that the liquidator, appointed by the government’s National Council of Privatisatio(NCP), said in an advert it wanted bidders with five years of telecom experience and a net worth of at least $200 million.

It said bids must be submitted on June 30, adding that the assets would be handed over to the preferred bidder in December.

The privatisation body has said it opted for a sale method it called “guided liquidation” because it wanted to protect the government from future claims and liabilities, as proceeds of the sale may be less than the value of the debt.

Nitel owes creditors – mostly suppliers – around 400 billion naira ($2.5 billion), with creditors taking a loss if the proceeds from the sale are not enough to repay all the debt.

In 2010 a consortium including Dubai’s Minerva and China’s second-biggest carrier China Unicom bid $2.5 billion for Nitel but could not raise the cash for the deal.

A separate consortium made a $959 million bid the same year but this failed when the bidder missed several deadlines.

Nitel’s fixed-line subscribers have fallen to fewer than 100,000 from five times that number in 2001 and subscribers to its MTEL mobile unit have dropped to a few thousand from over 1 million.

Nigeria has over 100 million mobile subscribers. ($1 = 162.55 naira).

Recall, Senate earlier rejected the move to liquidate NITEL.

The Chairman of the committee, Sen. Gbenga Obadara (ACN-Ogun), made the announcement at an interactive session with officials of the Bureau for Public Enterprises (BPE) and the National Council on Privatisation (NCP).

He expressed displeasure at government’s plans to liquidate the companies without making effort to find out their values.

“Nobody is telling us the worth of NITEL; we are only told how much NITEL owes. We should understand that it is all about protecting government’s enterprises.

“The condition of NITEL is not as bad as people portray. We have the option of making MTEL work; we could get credible people to run it. “We are not impressed about the term ‘guided liquidation’ because the same executive has masterminded the liquidation of most of the privatized companies since its inception in 2001,” he said.

Also, a Federal High Court sitting in Port Harcourt, Rivers State, once granted an injunction stopping the liquidation of the Nigerian Telecommunications Limited (NITEL).