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Syntel Partners Ericsson in bid to acquire NITEL

By on July 25, 2011

Nigerian firm Syntel has finalised a technical partnership agreement with Swedish equipment vendor Ericsson in an attempt to acquire a 75% stake in fixed line incumbent Nigeria Telecommunications (NITEL), after the latest attempt to sell the ailing telco was cancelled last month. Local news source THISDAY reports that under the agreement Ericsson would provide the technical assistance for the revival of NITEL, including the expansion of its network across the country. Snytel has also reportedly partnered with financial consortium DKAI to provideUSD1 billion for the acquisition of NITEL and its mobile arm M-Tel. Syntel’s chairman and CEO, Precious Elekima, said the company has finalised plans to acquire and revive NITEL and M-Tel and assured that if it was successful in its bid to purchase the telco, the company would be fully operational within 180 days. Earlier this month it was reported that Microfone Telecom Nigeria, an initiative of the Nigerian Capital Development Fund, had also expressed an interest in taking over the operations of NITEL.

The latest attempt to privatise NITEL was cancelled last month when the reserve bidder, British Virgin Islands-based Omen International, failed to meet the deadline to pay a bid security. Omen was invited to re-register its interest in buying NITEL in March 2011, after preferred buyer New Generation Telecommunications repeatedly missed the payment deadlines for its bid of USD2.5 billion. Omen offered USD956.9 million during the latest attempt to privatise the company, held in February 2010. The government began seeking a buyer for a minimum 75% of NITEL and 100% of M-Tel in July 2009 after previous majority shareholder Transcorp divested its stake earlier in the year.