Nigerian businessman Dr. Mike Adenuga has approached the government to acquire state-owned fixed line incumbent Nigeria Telecommunications (NITEL), after the latest attempt to sell the ailing telco was cancelled in June. Local news source THISDAY reports that Adenuga, who is the executive chairman of Nigeria’s second national telecoms operator Globacom, is said to have made an initial offer of USD450 million for a controlling interest in NITEL, with a commitment to inject an undisclosed amount as working capital into the company to revamp and upgrade its network. The businessman has said that if he is successful, NITEL will not be acquired by Globacom, but by a vehicle established especially for the deal. As part of his strategy for NITEL, Adenuga said he would launch an initial public offer (IPO) for NITEL to broaden the shareholder base of the company.
According to TeleGeography’s GlobalComms Database, the government began seeking a buyer for a minimum 75% of NITEL and 100% of M-Tel in July 2009 after previous majority shareholder Transcorp divested its stake earlier in the year. However, the latest attempt to privatise NITEL was cancelled in June 2011 when the reserve bidder, British Virgin Islands-based Omen International, failed to meet the deadline to pay a bid security. Omen was invited to re-register its interest in buying NITEL in March 2011, as preferred buyer New Generation Telecommunications repeatedly missed the payment deadlines for its bid of USD2.5 billion. Omen offered USD956.9 million during the latest attempt to privatise the company, held in February 2010. The Bureau of Public Enterprises (BPE) is now looking to adopt a ‘willing buyer-willing seller’ approach to privatising NITEL, but the privatisation agency is said to be awaiting approval from the Nation Council on Privatisation (NCP) before it can proceed with the transaction. Under the willing buyer-willing seller approach, the BPE would receive tenders for the telco and hold negotiations on the terms and conditions of a sale with prospective bidders, until an agreement is reached that is suitable for both parties.