A recent newspaper report in Nigeria suggest Virgin Mobile, BUA Group and Vodacom are lining up bids to buy Nigeria’s 9mobile (formerly known as Etisalat Nigeria). The report claims the three companies are putting finishing touches to their bids in respect of acquiring the 45% stake hitherto held by Etisalat of the UAE. Boye Olusanya, interim CEO of the company had hinted while launching 9mobile its new brand name that it was open to new investors.
Why the interest?
The intervention of the Central Bank of Nigeria (CBN) and Nigerian Communications Commission (NCC) in Etisalat Nigeria means the creditor banks are likely to soft pedal in respect of repayment terms. The stake is also likely to trade for a significant discount in view of the $1.2 billion debt the new owner will take on. 9 mobile continues to operate as a going concern, and was the unfortunate victim of the risks that come with borrowing in a foreign currency. Statistics from the NCC for the period ended May 2017 show the company gained the highest number of inward porting subscribers.
About the three “bidders”
BUA group was founded in 1988 by Abdulsamad Rabiu. The group’s operations are broadly divided into agriculture and infrastructure with BUA holding a controlling stake in Cement Company of Northern Nigeria (CCNN). In addition, BUA is into sugar refining and production of edible oil.
Virgin Mobile UK is one of the largest broadband operators in Europe, and is a subsidiary of Liberty Global, an American media conglomerate. The company was Virgin Mobile was founded in 1999 as a joint venture between One2One and Sir Richard Branson’s Virgin group, before its sale to NTL Telwest in 2006, and subsequently Liberty Global in 2013.
Vodacom, which is listed on the Johannesburg Stock Exchange (JSE) was founded in South Africa in 1994, and has operations in over 40 African countries including Kenya, Nigeria, Ghana, Zambia and Angola.
It is important to add that none of the reported bidders have confirmed these reports on their websites or in their respective stock exchanges. Virgin Mobile in January of this year became the third GSM network provider in UAE.