Access Bank, others, take over Etisalat as network provider accrues N541b debt
Access Bank PLC, along with a couple of other Nigerian and foreign banks, has taken over telecommunications company Etisalat after it accrued about $1.72 billion (N541 billion) in debt.
The takeover was confirmed by the Etisalat Group, the parent company of Etisalat Nigeria, on Tuesday.
New reports reveal that Etisalat had accrued the huge debt after taking a loan which involved a foreign-backed guaranty bond.
The telecoms company had taken the loan to finance a major network rehabilitation and expansion of its operational base in Nigeria.
It, however, failed to to meet its debt servicing obligations agreed since 2016, prompting the takeover.
The Emerging Markets Telecommunications Services (EMTS) set up by former UBA Chairman, Hakeem Bello-Osagie, to reach an agreement with the banks on debt restructuring plan in the protracted $1.72 billion (about N541.8 billion) debt impasse, had failed to yield any positive outcome.
EMTS Holding BV, established in the Netherlands, has up to June 23 to complete the transfer of 100% of the company’s shares in Etisalat to the United Capital Trustees Limited, the legal representative of the consortium of banks.
A filing by Etisalat Group Chief Financial Officer, Serkan Okandan, dated June 2107, partly reads:
“Further to our announcement dated 12 February, 2017, Emirates Telecommunications Group Company PJSC, ‘Etisalat Group’ would like to inform you that Emerging Markets Telecommunications Services Limited ‘EMTS’ (‘the company), established in Nigeria and an associate of Etisalat Group with effective ownership of 45% and 25% ordinary and preference shares respectively, defaulted on a facility agreement with a syndicate of Nigerian banks (‘EMTS Lenders’).
“Subsequently, discussions between EMTS and the EMTS Lenders did not produce an agreement on a debt restructuring plan.
“Accordingly, the Company received a default and security Enforcement Notice on 9 June 2017 requesting EMTS Holding BV (EMTS BV) established in the Netherlands, and through which Etisalat Group holds its interest in the company) requiring EMTS BV to transfer 100% of its shares in the company to the United Capital Trustees Limited (the Security Trustee”) of the EMTS Lenders by 15 June 2017.
“Subsequently the EMTS Lenders extend the deadline for the share transfer to 5.00 pm Lagos time on 23 June 2017.”
