BPE: NITEL could be sold in pieces

15 Jun 2009

In an interview with Nigerian newspaper Daily Trust, the spokesman of the Bureau of Public Enterprises (BPE), Chigbo Anichebe, said the government was considering selling incumbent telco NITEL’s fixed lines, mobile arm M-Tel, the company’s SAT-3 satellite business and its CDMA licence separately. Anichebe also dismissed rumours that the BPE was under pressure to sell the ailing telco to Nigeria’s second national operator (SNO) Globacom, without following due process of bidding. The Nigerian Communications Commission (NCC) has expressed concern about Globacom’s interest in NITEL; if the SNO is successful in acquiring the 51% stake in the telco it will have a monopoly on fixed line services in Nigeria.

According to TeleGeography’s GlobalComms database, the federal government sold its 51% stake in NITEL to local company Transcorp for USD750 million in November 2006, retaining a 49% interest. Since then the telco’s initial 500,000 fixed lines in service have dropped to about 45,000, its workforce has declined from 12,000 to just 2,000 and the company is USD500 million in debt. In February 2009 Transcorp agreed to divest part of its shareholding in the telco and in late March the BPE announced it was offering a 51% stake in the fixed line operator and 100% of its mobile unit. In late May Nigeria’s anti-corruption police charged the head of Transcorp and two other employees with fraud for embezzling around USD110 million belonging to NITEL and the following week the government revoked the sale of the incumbent to Transcorp.

Nigeria, ntel (formerly NITEL/M-Tel)