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9Mobile’s acquisition timeline extended indefinitely

9Mobile’s acquisition timeline extended indefinitely

Nigerians may have to wait a little longer for a new owner of the embattled telecom operator, 9Mobile, New Telegraph has learnt. 

This came as the parties to the deal are said to have agreed on timeline extension for the acquisition process. Although regulators have kept mum over the deal, as the deadline for payment by the preferred bidder,Teleology Holdings, lapsed last Wednesday; a statement from 9Mobile disclosed that period of the transaction had now been extended. The company, in the statement, gave no specific date for the conclusion. “The timeline extension was considered necessary to enable parties involved in the sale process to finalise the requisite transaction documentation to facilitate a smooth closure and transition to the new investor,” the company said in a statement signed by its CEO, Mr. Boye Olusanya.

The extension came on the heels of a strategic meeting held last Tuesday between the Nigerian Communications Commission (NCC), the Central Bank of Nigeria (CBN) and other stakeholders to decide on the stand of the preferred bidder. Teleology initially had until end of June to make the balance payment of $251 million to take over 9Mobile. However, the company pleaded for an extension for 20 days, which lapsed last Wednesday. Tuesday’s meeting, which ended 7p.m. in Lagos, was to be a decisive one on the acquisition process that started since last year. However, when this newspaper contacted the Director of Public Affairs of the NCC, Mr Tony Ojobo, to inquire about the outcome of the meeting and the fate of Teleology, he simply said: “There is no information on that for now.”

When prodded further to know if the meeting actually held, Ojobo admitted that there was a meeting, but he could not say anything about what happened at the meeting or the outcome. Efforts to get the promoter of Teleology, Mr. Adrian Wood, to comment on the state of things regarding the deal, proved abortive, as his line was not reachable as at the time of filing this report. Barclays Africa, the Financial Adviser handling the sale of 9Mobile, had in February 21, 2018, named Teleology Holdings Limited as the preferred bidder for the acquisition of 9Mobile and Smile Telecoms Holding as the reserve bidder.

Barclays Africa had directed Teleology to make initial non-refundable cash deposit of $50 million within 21 days, which expired on March 21, 2018, and pay the balance of $251 million within 90 days from March 21. NCC had earlier said it would carry out due diligence on Teleology Holdings to ascertain its financial strength and technical capabilities to take over 9Mobile before it would approve the use of 9Mobile licence by Teleology. Although NCC is yet to release its findings on the due diligence carried out on Teleology Holdings, Tuesday’s meeting was expected to bring up discussions on NCC’s findings on the due diligence on Teleology. 9Mobile, formerly known as Etisalat Nigeria, became the fourth entrantinto the Global System for Mobile communication (GSM) space in Nigeria, when it rolled out its commercial services on October 23, 2008. But for want of network expansion, the telecoms company, in 2013, approached a consortium of 13 local banks for a loan of $1.2 billion for network upgrade and expansion.

However, citing economic downturn of 2015- 2016 and naira devaluation, which negatively impacted on the dollar-denominated component of the loan, the former Etisalat Nigeria fell short of repaying the loan, a situation that compelled the lenders to plan possible takeover of the telecoms company. The intervention of NCC and the CBN eventually led to the planned sale of 9Mobile in order to recover enough money to pay its debt.
New Telegraph

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