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NATCOM makes full payment for NITEL

By on April 12, 2015

The preferred bidder for Nigerian Telecommunications Limited, NATCOM Consortium, has paid $176,575,700 (N29, 696,469,600) as the outstanding amount for the acquisition of the Federal Government-owned company.

The amount represents the outstanding 70 per cent of the $252,521,000 bid price for the acquisition of the assets and business units of NITEL and its mobile subsidiary, the Nigerian Mobile Communications Limited.

The Bureau of Public Enterprises in a statement by its Head of Public Communications, Mr. Chigbo Anichebe, in Abuja on Friday said NATCOM had paid the 70 per cent balance on Thursday.

He said the payment came four days ahead of the April 7 deadline set for the payment of the outstanding amount.

NATCOM had on January 6 paid $75,756,300 (N12, 727,058,400), being 30 per cent of the bid price in line with the offer letter by the BPE.

The bureau had mandated NATCOM to make an initial deposit of 30 per cent of the bid price not later than 14 days from the date of the offer letter.

The National Council on Privatisation had at its meeting on February 27, 2012, approved the privatisation of NITEL and MTEL through “guided liquidation”.

The strategy was adopted by the council after due consideration of other options and previous failed attempts by the BPE to privatise NITEL and MTEL through strategic core investor sale and negotiated sale strategies, and the huge liabilities to creditors to the tune of over N300bn.

Under the guided liquidation strategy, all the core assets and business undertakings of NITEL and MTEL were to be sold to a qualified bidder by the liquidator under the general guidance of the NPC.

Consequently, advertisements for the submission of Expressions of Interest from prospective bidders for the acquisition of the assets and business undertakings of NITEL and MTEL were placed in both local and international print media by the liquidator.

At the closing date on June 30, 2014, 17 organisations/consortia had submitted EOIs of which only two satisfactorily met the stipulated criteria for pre-qualification.

On September 18, 2014, the two successful applicants, NATCOM Consortium and NETTAG Consortium, that met the minimum pass mark of 75 per cent , were pre-qualified and issued the Request for Proposals and allowed to proceed to data room and physical due diligence stage prior to preparation and submission of their technical and financial proposals.

Following the disqualification of NETTAG Consortium, the financial bid of NATCOM Consortium was qualified for opening on December 3, 2014; having scored an average of 92 per cent in its technical proposal which was above the minimum pass mark of 75 per cent and had also satisfied the requirement of a valid bid bond.

Accordingly, the financial proposal of NATCOM consortium which was publicly opened on December 3, 2014 won with a bid price of $252.25m.

Consequently, the consortium on December 22, 2014 in Abuja signed the Assets Sale Agreement and obtained the offer letter from the liquidator of NITEL/MTEL and BPE.