BUHARI TO PERSONALLY PROBE SALE OF NITEL

President Muhammadu Buhari
has mandated the ministry of
communication to provide details
of the recent privatisation of the
Nigerian Telecommunications
(NITEL) and its mobile arm,
MTEL, to ascertain whether or
not Nigeria was short-changed.
Speaking to journalists Tuesday
after briefing the president on
the activities of the ministry of
communications, permanent
secretary Tunji Olaopa said the
president requested that a memo
detailing how the transaction
was processed be submitted
directly to him.
He said Mr. Buhari was
concerned about the possibility of
Nigeria not receiving a fair value
from the deal.
“The president was also
concerned about the liquidation
of NITEL. He is not opposed to its
privatization but he wants to
know… and he wants us to bring
a memo on how the whole
transaction was undertaken so
that he would know whether
Nigeria was short-changed,” he
said.
Mr. Olaopa said the president
was very concerned about the
whole issue of privatization that
is hindering investments in ICT
and said “that he will personally
champion this”.
“The president talked about the
potentials of the ICT sector in
generating employment,” Mr.
Olaopa said.
He said Mr. Buhari was also
concerned about the quality of
service from telecom operators in
the country.
The privatisation of the NITEL
and MTEL was completed in
December 2014 after the financial
bid was opened in October 2014
by the Goodluck Jonathan
administration.
A consortium run by Skye Bank’s
chairman, Tunde Ayeni, the
founder of Sahara Energy, Tonye
Cole, and two other companies,
received the nod from the
Nigerian government to take over
the two companies for $242.3
million (about N42.4 billion).
Their investment vehicle, NATCOM
Telecommunications, emerged the sole bidder
for the Nigerian Telecommunications Limited,
NITEL and Mtel.
NATCOM has as members NATSPACE
Telecommunication Investment Limited, PCCW
Global Limited, Prime Union Investment
Limited, Olutoyi Estate Development &
Services Limited, Legal Resources Alliance &
Co., Sahara Energy Resources Limited, and LM
Ericsson Nigeria Limited.
Of the seven firms, Mr. Ayeni, profiled as a
businessman and lawyer on Skye Bank’s
website, owns three.
He is the founder and operator of Prime
Union Investment Limited, Olutoyi Estate
Development & Services Limited, and Legal
Resources Alliance & Co. There were
suggestions that he has link with NATSPACE,
but PREMIUM TIMES could not independently
verify that claim.
In December 2014, Mr. Ayeni led NATCOM in
its acquisition of NITEL/MTEL less than two
months after he also led Skye Bank to buy
Mainstreet Bank from Assets Management
Company of Nigeria, for N120 billion.
In 2013, Mr. Ayeni was the chief promoter of
Integrated Energy Distribution and Marketing
Company Limited, a group that eventually
bought the Ibadan and Yola electricity
Distribution Companies, DISCOs.
Mr. Cole is the owner of Sahara Energy, while
LM Ericsson is a subsidiary of Swedish group,
Ericsson.
NATCOM, which merges the seven firms,
appears to be a new corporate entity created
solely for the purchase of NITEL/MTEL. Very
little is known about the consortium.
NATCOM emerged winner after NETTAG
Consortium, another little known group, was
disqualified for failing to attach a $10million
bid bond to its bid submission as stipulated in
the Request for Proposals (RFP) to prospective
bidders.
History of failed sales
Before the acquisition, four previous attempts
to sell NITEL failed.
Nigeria started the process of privatising the
national telecom groups in 2000 as part of the
government’s reform of the
telecommunications sector.
In 2001, the government tried to sell 51 per
cent equity to Investors International London
Limited (IILL) as the strategic core investor.
There was also the failed management
contract by Pentascope in 2005, the aborted
Orascom Telecoms bid in 2005, and the
strategic core investor sale through negotiated
sale strategy to Transcorp that was cancelled
in 2009.
The last effort was the strategic core investor
sale in 2011, where New Generation
Communications Limited and Omen
International emerged preferred and reserved
bidders respectively.
Following the last failed attempt, former Vice
President Namadi Sambo-led National Council
on Privatisation, adopted the guided
liquidation strategy for the sale of NITEL/
MTEL.