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 Daily Independent Online.
* Monday, July 26, 2004.
NITEL for sale without SAT-3 cable
By
Shina Badaru
IT.Telecom Editor
Abuja
plans to sell off its stake in the Nigerian Telecommunications Limited
(NITEL) without SAT-3, a segment of the submarine optical fibre cable
which links Africa with the rest of the world.
Some
groups eyeing the 51 per cent shares are surprised to learn of the
proposal that possibly arose because of government desire to set up an
autonomous company to provide SAT-3 for commercial traffic.
Communications
Minister Cornelius Adebayo spoke of the divestment in an interview and
confirmed plans to sell NITEL. But he declined to give details, saying:
“I can’t sell NITEL. You will have to ask the BPE (Bureau of Public
Enterprises)”.
BPE
officials too were non committal. They said anonymously that they are yet
to receive details of the strategy to sell the national carrier.
Daily
Independent reported exclusively on July 12 that various Nigerian, South
African and other foreign investors are already in the race to acquire
control of NITEL.
Rather
than the entire NITEL bouquet of services, investors have their sights on
MTel, its mobile cellular operator, and the SAT-3. Interest in MTel
is driven by its profit
potential induced by the soaring uptake of cell phones as against fixed
lines.
The
other reason is that the high bandwidth SAT-3 link supporting high speed transmission of voice,
video and data offers huge market potential for operators seeking
alternatives to the expensive satellite links used for international
telecoms traffic.
SAT-3,
with its Nigerian end landing in Lagos, is part of the 120-Gb/s South Atlantic
Telecommunications Cable No. 3/West African Submarine Cable/South Africa-Far East
(SAT-3/WASC/SAFE) system. It is spearheaded by Telkom of South Africa.
The
submarine cable is owned by a consortium of 36 which includes leading
African telecoms companies, among them NITEL which contributed about $50 million and
Telkom which came up with
$85 million to construct the
$650 million link. SAT-3 began commercial service in April 2002.
The
new owners of NITEL may inherit a management contract signed with
Pentascope International of the Netherlands, appointed to enhance its
market value.
Reacting
to questions on SAT-3, Adebayo said: “Why must the government sell NITEL
with SAT-3? We have an obligation to the people of Nigeria. We can’t sell
NITEL cheaply”.
He
denied that the Federal Executive Council (FEC) rejected a N55 billion
proposal by the Ministry of Communications to inject a new lease of life
into the firm.
The
three-year contract with Pentascope was signed in March last year to
refurbish both NITEL and MTel.
It
was the fallout of the unsuccessful sale of NITEL after Investors
International London Limited (IILL) failed to pay up the balance of its
$1.317 billion offer for the 51 per cent stake in November 2001.
Singaporean
investors, the Chagouri family, which own Motophone, may feature in the
new quest for NITEL. NewTel, a consortium that bid unsuccessful in the
January 2001 auction of GSM licences, may also participate.
NewTel
is expected to feature Kwame Amuah, Chairman of the team as well as
son-in-law to former South African President Nelson Mandela. Amuah
participated in South Africa’s controversial second national operator
(SNO) bid and may be joined by Moletsi Mbeki, brother of South African President Thabo Mbeki.
Others
on the NewTel team include Tokunbo Sijuade, son of the Ooni of Ife, Oba Okunade Sijuade; Amuah’s
advisor Andre Gyenifie; Lagos lawyer Seye Kosoko and Seye Oladapo, a Director in National
Bank of Nigeria who doubles
as Financial Director of the group.
The Chagouris are expected to
feature in the reconstituted NewTel consortium.
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