President Olusegun Obasanjo has ordered all government ministries and agencies to reconcile all outstanding debts owed to Nigeria Telecommunications (NITEL) in a bid to boost the telco’s value prior to its sale. NITEL is reported to be owed over NGN6 billion (USD48.8 million) by government agencies, which has contributed to the company’s crippling financial situation. If the directive to pay up is obeyed, NITEL’s financial position would be markedly improved, a development which would in turn increase NITEL’s value prior to its sale later this year.
In May 2006 the Nigerian government revealed that of the 27 companies to have expressed an interest in the sale of NITEL, seven had been shortlisted to go forward to the sale proper, described by the BPE as a ‘negotiated sale’ rather than an auction. Under the privatisation 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 Korean Telecom, MTC/Celtel International, South Africa’s Telkom, Investcom (which was acquired by MTN last month) and UAE-based Etisalat.