Nigerian banks have asked UAE telecoms group Emirates Telecommunications Corporation (Etisalat) to inject fresh equity into its Nigerian unit, after the operator missed a payment on its USD1.2 billion loan, a senior banking source told news agency Reuters. According to the unnamed source, Etisalat Nigeria had given notice to lenders that it would miss a February payment which triggered a debt discussion, adding that they were yet to renegotiate the terms. The source added that lenders have asked Etisalat Nigeria to convert shareholder loans on their books into equity and inject fresh capital to free up its cash flows, in addition to asking that Etisalat increase its 40% stake in the local cellco.
TeleGeography’s GlobalComms Database states that Etisalat signed a USD1.2 billion loan with a consortium of 13 banks in May 2013 to refinance its commercial medium term debt and to continue its network rollout and modernisation. Ibrahim Dikko, vice president for regulatory affairs at Etisalat Nigeria, said the operator has missed payments due to an economic downturn and currency devaluation in the West African nation, as well as dollar shortages on the country’s interbank market.