Consequent upon complications arising from the $1.2billion loan default by 9mobile (Etisalat) to a consortium of banks, about 20 million Nigerians who are subscribers of the telecoms company would be cut off from the network services of the company in 2022.
That is even as over four thousand staff of the company risk being laid off in the same year. This was revealed during the investigative hearing by the Senate Joint Committee on Banking, Insurance and other Financial Institutions, Communications and two others, which was mandated to investigate the loan default which is threatening the existence of the 9Mobile.
This, according to the Committee, can only be averted if a new buyer emerges, takes over the company and pays off the debt before the 15 years operational license given to the company expires in 2022. Speaking at the investigative session, the Nigeria Communications Commission (NCC), represented by the Director of Legal Services, Yetunde Akinoye, stated that the 9Mobile was given a 15 year license in 2007, to operate in Nigeria, which according to her, will expire in 2022.
She said that, given the financial crisis facing 9mobile, the hope was that a new investor (buyer) would emerge to take over the company, pay back the consortium of banks the loans which the original owners of the telecom company collected, and also pay for the renewal of the license to retain the services and subscribers. She said if this was not possible, the banks, in alliance with their security trustees, might push to enforce the loan conditions on the 9Mobile, which she explained, might involve stripping the telecoms company to recover their investment.
Akinoye further recalled that although she was not privy to the loan agreements, the NCC got a letter on the 21st of June, 2017, from the Security Trustee of 9Mobile, notifying them that there was a loan default and that the lenders (banks) wanted to enforce the legal implication.
She said the banks, which had already taken over the telecoms company, wanted the board of the 9mobile to be dissolved and a neutral person brought in, to which they wanted the CBN to takeover. She said the CBN governor who did not want the apex bank to become involved, however dissolved the old board and constituted a new board chaired by the CBN Deputy Governor, to ensure that the 20 million subscribers and four thousand staff were not left high and dry.
On why the NCC could not allow the banks to take full ownership of the company, the NCC representative said “the transfer of license is not allowed by NCC except under certain condition but they can transfer the shares. The banks were only interested in getting their money but not to run the company”.
She also said the NCC, unlike the CBN in the case of banks, does not have powers by the Act establishing it, to take over telecoms company that are collapsing. Akinoye also said that given the way Mubadala and the associate paid $250 million to get the Etisalat license, NCC never suspected that anything would go wrong, adding that the NCC was already doing a forensic investigation.