Rumour: Etisalat Nigeria shareholder Mubadala could be leaving, sources claim

16 Jun 2017

An unconfirmed report in Nigerian newspaper Premium Times quotes anonymous sources as claiming that Mubadala Development Company – a United Arab Emirates (UAE) government investment vehicle – has decided to exit the ownership of Nigeria’s fourth-largest mobile operator, Etisalat Nigeria. TeleGeography’s GlobalComms Database says that Etisalat Nigeria’s largest shareholder is UAE-based mobile operating group Emirates Telecommunications Corporation (Etisalat), which increased its stake in the Nigerian cellco from 40% to 45% in February 2017 when a loan was converted to equity; up to that date Mubadala Development Company owned 30% of Etisalat Nigeria’s shares, with the remainder held by Premium Telecommunications Holdings Ltd (PTHL), a special purpose vehicle which holds the interest of Nigerian investors. As Etisalat Nigeria’s debt problems continued, in March 2017 the Central Bank of Nigeria (CBN) and the Nigeria Communications Commission (NCC) agreed with local banks to pursue a default deal rather than a receivership for the cellco, to avoid deterring investors and a wider debt crisis. However, negotiations with lenders on proposed restructuring of USD1.2 billion loans stalled in May, whilst Etisalat (UAE) said it was not willing to invest more, having written down its Nigerian investment to USD50 million.

One of Premium Times’ sources said: ‘I can tell you that Mubadala’s withdrawal takes effect from today [Thursday 15 June]’, whilst the article speculated that this event might lead to the creditor banks taking places on Etisalat’s board. Another anonymous source claimed that the banks will seek to set up a new holding vehicle to continue running the cellco, and will approach the NCC with such a plan by next week at the latest.

Nigeria, Emerging Markets Telecommunication Services (9mobile), Etisalat Group