Nigeria pulls plug on Nitel sale - TechCentral

Nigeria pulls plug on Nitel sale

Lagos, Nigeria's largest city

Nigeria has cancelled a US$2,5bn bid for its failing telephone company after the bidder defaulted on a $750m down payment, the most recent of numerous setbacks to privatise the company since 2001, an official said on Friday.

Nigeria’s bureau of public enterprises is brokering the sale of 75% of Nigerian Telecommunications Ltd, known locally as Nitel, on behalf of the government.

The New Generation Telecommunications Consortium won a $2,5bn bid last October to purchase. It was supposed to pay $750m by 5 November, but more than three months later it has still not paid up.

“We are not considering them anymore because they have failed,” said bureau of public enterprises spokesman Chukwuma Nwokoh.

The proposed sale to the consortium, which Nigerian federal officials say includes China’s Unicom, Dubai’s Minerva and local company GiCell, had faced scrutiny before it was eventually cancelled.

State-owned Unicom, one of China’s three major phone carriers, said in February that it had expressed interest in a technical role in privatising Nitel, but denied that it was part of the consortium bidding for the carrier.

The group’s $2,5bn bid also appeared grossly overpriced considering the infrastructure’s decrepit state.

The bureau of public enterprises has now recommended that the government consider the second highest bidder, Omen International, which offered $956,9m, just over a third of what New Generation had offered.

“If we do not get permission to invite Omen International, there are other scenarios that we have created,” Nwokoh said.

Nitel, in principle, provides landline telephone services in Nigeria, Africa’s most populous nation with 150m residents. However, the state company’s telephones now rarely work and Nigeria has an estimated 1,3m landline telephones, compared to 62,9m mobile phones.

Privatising Nitel could prove profitable, as the company does have lines strewn throughout Nigeria’s cities. But attempts to do so have failed over the last decade.  — Sapa-AP

Comments are closed.