9Mobile sale: No winner yet, Teleology, Smile emerge top two contenders

It was gathered that at the weekend that Smile Communications and Teleology Holding Limited have emerged as the top two contenders in the 9mobile bidding process and have been given 30 days to prove financial strength to take over ownership of the troubled telecommunications company.

In a meeting held on Friday 26, January 2018, with the interested bidders, the lender banks named Smile, Teleology and Globacom as top contenders.

This came after the abrupt pull out of Bharti Airtel and the confirmation that Globacom and Helios Investment Partners failed to back their technical bids with the submission of a concrete financial bid, 9mobile was left with Smile and Teleology as the top two contenders.

Final submissions however suggest that Teleology may emerge as preferred bidder, having submitted a financial bid in excess of $500 million dollars before the January 16, 2018 deadline while Smile Telecoms Holdings quoted close to $300 million.

Bharti Airtel, Smile Telecoms Holdings, Helios Investment Partners LLP, Teleology Holdings Limited and Globacom were in December 2017, shortlisted as the five bidders still in the running to take over ownership of 9mobile, after a rescheduled bidding process took place with the approval of both regulators and lender banks involved.

Bharti Airtel recently pulled out of the process saying that there were a lot of “hidden things” surrounding the health of 9mobile and, “we decided not to submit a final bid because we felt that we did not have sufficient information to make an informed bid.”

This development came after Spectrum Wireless, spearheading other none bank investors in EMTS also known as Etisalat, now 9mobile, with about 17.5 percent stake in the company, had taken United Capital Trustees Limited, representatives of the bank debtors to court, challenging the earlier granted ex-parte order, which led to the nullification of the Interim Board set up for 9mobile.

Justice Ibrahim Buba of the Federal High Court also dismissed the preliminary objection filed by United Capital Trustees Limited, in response to the application by Spectrum Wireless and this made some potential investors grow cold feet, which may have led to the refusal of some to submit financial bids.

However, sources say that an appealed case allows all parties to maintain status quo. “The status quo, which is the existing state of affairs, means that the sale of 9mobile will continue until the Appeal Court passes its judgment,” ThisDay quoted in its report.

Teleology Holding Limited is a Special Purpose Vehicle (SPV) formed and owned by telecommunications industry veterans including, Adrian Wood, one-time CEO of MTN Nigeria, specifically to acquire a substantial holding in 9mobile and thereafter, potentially other underperforming Mobile Network Operators (MNOs). Included in this team are five of the top leadership executives who established and grew MTN Nigeria from 2001 to 2005.

Smile communications is a pan-African telecommunications group founded in 2007 with operations in Nigeria, Tanzania, Uganda and the Democratic Republic of the Congo. In 2012, the company launched Africa’s first 4G LTE commercial network in the 800MHz band (ITU “band 20”) in the East African market, starting in Dar es Salaam, Tanzania and then Kampala, Uganda. This was followed by the launch of West Africa’s first 4G LTE commercial network, also in band 20, starting in Ibadan and then Lagos, Nigeria.

In February 2017, Etisalat was unable to pay back the $1.2billion medium term syndicated loan facility taken in May 2013 from 13 Nigerian banks.

Ibrahim Dikko, Vice President, Regulatory and Corporate Affairs, Etisalat Nigeria, at the time, said that; “Etisalat had missed its loan payment in Nigeria because of the economic downturn, currency devaluation and dollar shortages on the country’s interbank market.”

The company was then forced to rebrand after its Abu Dhabi arm pulled out and new board members were appointed to run the affairs the company following failed negotiations with its lenders.

The preferred bidder who finally acquires 9mobile will be faced with the responsibility of retaining its 17 million customers and improving on the company’s 12 per cent market share.

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