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EFCC to probe Vodacom�s pull-out from Econet
Our Correspondents
The Executive Chairman of the Economic and Financial Crimes Commission, Mr. Nuhu Ribadu, on Wednesday, confirmed that the commission had begun investigations into circumstances surrounding the withdrawal of Vodacom of South Africa from Econet Wireless Nigeria Limited.
Ribadu, who stated this in a signed statement in Abuja, also disclosed that the commission was investigating all the issues involved in the legal tussle between Econet Wireless International and Econet Wireless Nigeria as well as the withdrawal of Vodacom from Econet Wireless Nigeria Limited now known as V-Networks.
Besides, he noted that the commission would also determine the implications of the withdrawal and legal tussle on foreign direct investment into the country.
The EFCC boss listed the other terms of reference of the investigation to include:
� Determine to what extent corporate governance and transparency have been compromised in the relationships between Econet Wireless Nigeria Limited (V-Networks) and Econet Wireless International.
� Determine to what extent corporate governance and transparency have been compromised in the relationships between Econet Wireless Nigeria Limited (V-Networks) and Vodacom.
� Establish whether or not laws of the Federal Republic of Nigeria as contained in the Companies and Allied Matters Act have been complied with.
� Investigate whether the companies involved in the brokerage are duly licensed to offer such services or not.
� Investigate the appropriateness or otherwise of the brokerage fees paid to the three companies with the laws of the Federal Republic of Nigeria, and
� Investigate the roles of the regulatory agencies such as Nigeria Communications Commission and the Securities and Exchange Commission in the equity investment transaction and to determine if Nigerian court sanctions were obtained.
�EFCC investigations is also to determine the financial losses (if any) and recover same; invite and ensure the attendance/appearance of any person to assist in the investigation as well as liaise with the relevant bodies either public or private including the Ministry of Communications to make and implement its recommendations,� Ribadu further stated in the statement.
However, reliable sources confirmed to our correspondents on Wednesday that The Presidency compelled the investigations of the Vodacom�s withdrawal by EFCC.
According to the sources, the withdrawal of Vodacom was capable of threatening the image of the country and hindering more investors coming to do business in Nigeria.
�The Federal Government regretted the withdrawal of the South African based investors and the reasons for the action. The EFCC is being compelled to investigate the deal in order not to bring the country in bad light before the foreign investors,� the sources stated.
The payment of brokerage fees by Econet Wireless Nigeria to some companies, which contributed to the withdrawal of Vodacom, came to the fore on Monday, May 31.
Vodacom pulled out of Nigeria barely two months after officially taking over the management of former Econet Wireless Nigeria.
It also terminated its plan to inject about $200 million in equity investment and operating loan into the embattled EWN.
The decision to pull out of Nigeria was reached on May 27 at the Vodacom�s board meeting held in Johannesburg, South Africa.
The South African company, at the meeting, alleged corruption against some shareholders of the EWN. It alleged that brokerage fees were paid on the investments of three state governments, namely Lagos, Delta and Akwa Ibom.
The brokerage fees for Lagos State was made to Oceanic International Bank Limited through its Oceanic Securities Limited; Delta State payment was made to Bromley Assets Management Limited, while Akwa Ibom�s payment was made to EMPEE Ventures Limited.
In a letter dated May 28, 2004 and addressed to the Chairman of EWN (V-Networks), Mr. Oba Otudeko, the Vodacom�s Group Chief Executive Officer, Mr. Alan Knott-Craig, said, �It is with regret that I must inform you that the Vodacom Group Board resolved at its meeting on May 27 that it can no longer pursue the transaction envisaged with EWN.
�It is also resolved to terminate the current Management Agreement, which has been in place since April 1, 2004, no later than June 6. These decisions were reached after careful and lengthy deliberations by the board.
�Whilst I do not believe it appropriate in this letter to go into the reasons for the Board�s decision, I do wish to make it clear that the Board considers that it has valid grounds for terminating the Management Agreement,� the letter reads.
Meanwhile, on an explanatory visit to the Minister of Communications, Chief Cornelius Adebayo, on Wednesday, Vee Networks Managing Director, Mr William Swart ,said the withdrawal of Vodacom from its ill-fated technical partnership would not affect the performance of the Nigerian company.
"Recent events have not affected the viability of and prospects of Vee Networks," Swart said adding that the company is still committed to its targets and plans within the national GSM service provision.
Adebayo told the visiting Vee Networks boss and his team that the Federal Government was interested in all forms of investments in the country and was ready to protect them. He added that the government was watching closely developments in the mobile company and expressed satisfaction that its management came to acquaint him with facts of recent events.
The Punch, Thursday June 17, 2004
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