The fate of Etisalat Nigeria, the fourth largest telecommunications network operating in the country, hangs in the balance as the telecom giant battles to pay its creditors.
Etisalat Nigeria had in 2013 obtained a seven-year loan facility of $1.2billion from 13 local banks and their foreign counterparts to refinance a $650 million loan as well as the expansion of its network but the company had missed the payment due to dollar shortfall in Nigeria’s financial system. The loan, which involved a foreign-backed guaranty bond, was for Etisalat to finance a major network rehabilitation and expansion of its operational base in Nigeria.
The 13 local banks involved in the loan deal include: Zenith Bank, GT Bank, First Bank, UBA, Fidelity Bank, Access Bank, Ecobank, FCMB, Stanbic IBTC Bank, and Union Bank.
Investigation by The Nation revealed that Abu Dhabi state investment fund Mubadala, the second-largest shareholder in the business, had in April presented a final restructuring plan to the banks which they flatly rejected. The banks further gave a one month window for repayment which lapsed in May 31st, 2017.
The Nation gathered that with the telecoms company unable to redeem its payment, the banks have since issued Etisalat a default notice.
This is just as The Nation learnt at the weekend that Etisalat Nigeria is working with its lenders and Abu Dhabi state investment fund Mubadala, the second-largest shareholder in the business, to resolve debt woes it said were caused by a devaluation of the naira currency.
Mubadala spokesman Brian Lott told Reuters on Friday that a local media report saying that the fund has pulled out of Etisalat Nigeria was wrong and that several proposals are under discussion.
He declined to elaborate on the options being considered but said he will know more next week.
The Nigerian affiliate of Abu Dhabi-listed Etisalat has said it is in talks to restructure a $1.2 billion loan after missing a repayment, though sources have said that talks reached a deadlock on April 28.
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