Of the 27 companies to have expressed an interest in the sale of Nigerian incumbent NITEL, seven have been shortlisted to go forward to the sale proper. According to a statement by the Bureau for Public Enterprise (BPE), all seven are currently conducting due diligence on the company. The Nigerian government is describing the disposal as a ‘negotiated sale’ rather than an auction. Under the new process, if the preferred bidder’s offer is deemed unacceptable, all suitors will be given the same transaction documents to make counter offers. The government will then review all bids and select a winner. The shortlisted bidders are: local conglomerate Trans-national Corporation (Transcorp) in partnership with the UK’s BT Group; Nigeria’s number two cellco Globacom; Afro Telecommunications and Korea Telecom; MTC/Celtel International; South Africa’s Telkom; Investcom (which was acquired by MTN earlier this month); and UAE-based Etisalat.
The sale of NITEL has been something of a bugbear for the government, with the privatisation having failed three times. Most recently, in December last year an offer by Orascom of USD256.5 million for a 51% stake was rejected because it fell below the reserve price. Earlier, in 2002 Investors International Limited (IIL) failed to make payments following a bid of USD1.317 billion, while the following year Pentascope failed to meet contract obligations, resulting in cancellation of its agreement.