The
controversies surrounding Etisalat Nigeria’s indebtedness to a consortium of 13
banks deepened on Thursday with the telecoms firm insisting that it had repaid
about
42 per cent of the $1.2bn loan, while some of the banks involved in the
transaction maintained that it had “only paid $58.9m.”
Sources
privy to the series of meetings between Etisalat and the banks, said that the
$58.9m was just 10 per cent of the total sum owed the consortium by the
telecommunications company.
However,
Etisalat Nigeria said in a statement by its Vice President, Regulatory and
Corporate Affairs, Ibrahim Dikko, “Contrary to the widely reported
misrepresentations about Etisalat Nigeria’s debt obligation to the consortium
of 13 banks, it has become pertinent to set the records straight. Prior to this
time, Etisalat had in fact consistently and conscientiously met up with its
payment obligations.
“As of
today, we can categorically state that the outstanding loan sum to the
consortium stands at $227m and N113bn, a total of about $574m if the naira
portion is converted to US dollars. This, in essence, means almost half of the
original loan of $1.2bn has been repaid. Etisalat continued to service the loan
up until February 2017, when discussions with the banks regarding the repayment
restructuring commenced.”
One of the
bank officials said, “Etisalat has over $600m debt due to creditors,
distributors and vendors like Huawei Technologies and IHS.
“Rather than
map out a plan to pay the 90 per cent that is remaining of its debt to the
consortium of banks, it asked the banks to stand still and write it off as a
bad debt after it paid $58.9m.”
However,
Dikko told one of our correspondents that the firm had paid about $574m, which
was known to the Central Bank of Nigeria and the regulator of the telecoms
industry, the Nigerian Communications Commission, adding, “That’s the figure we
have in our books and which we reported to the regulators.”
However, the
bank officials dismissed reports that the lenders had taken over the running of
Etisalat operations.
One of the
sources explained, “That can’t be true, because there is no legal takeover,
neither has there been any operational takeover.
“For you to
legally take over a company, you have to go through the courts and the
Corporate Affairs Commission; and for you to take over operationally, there has
to be a change of management structure. But none of these has happened.
“The banks,
at the last meeting with the Etisalat management, made it clear that they were
not interested in taking over Etisalat and they would never be interested. What
they want is nothing but their money in full and the full interest charges.”
The
officials also stated that the banks had been fair to the telecoms company by
making the payment plan flexible.
“They
reduced the debt burden by between 20 and 30 per cent. The banks also agreed
that they would ask for discounted rate on the interest rate by six per cent,
to cushion the effect. They banks also asked them to pay over an eight-year
period,” the source added.
Dikko also
denied reports that the management of Etisalat Nigeria was being investigated
by the Economic and Financial Crimes Commission following a petition to “the
Federal Government asking that Etisalat be investigated” on how the funds from
the syndicated loans were utilised.
He stated,
“Etisalat wishes to categorically affirm, for the avoidance of doubt, that the
reports are patently false and most unfortunate considering the damage such
misleading information can have not only on our business, but indeed on the
telecommunications industry and the country as a whole.
“Concerned
parties have access to our books and do not require an investigation into how
the loan sum was utilised. All of the infrastructure investment and services
for which the loan was secured were paid through our banks and these are
verifiable.
“It will be
recalled that the $1.2bn loan, a medium-term seven-year facility, was obtained
by Etisalat Nigeria for the purpose of expanding its network and improving the
quality of service on its network. The economic downturn of 2015 and sharp
devaluations of the naira negatively impacted on the dollar-denominated loan by
driving up the loan value, thus prompting Etisalat to request a loan
restructuring from the consortium of banks.”
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