As the deadline for the payment of a non-refundable cash deposit of $50 million by the preferred bidder of 9mobile-Teleology Holdings elapses this week, there are reports that the second preferred bidder Smile Telecoms is gearing up should the preferred bidder Teleology Holdings default in the payment.
Recall that Barclays Africa, the supervisor for the sale of the embattled 9mobile recently announced Teleology Holdings-a private equity firm promoted by Adrian Wood, former CEO of MTN Nigeria as the preferred bidder.
What happens if Teleology defaults?
The sale adviser, Barclays Africa, had in a letter dated February 21 to Teleology Holdings gave a 21-day timeline to deposit $50 million or forfeit its place as the preferred bidder and in the event of the preferred bidder not paying, the reserved bidder Smile Telecoms will take its place.
Smile Telecoms bid for the country’s fourth-largest telecom provider failed, but, the management says it still has its eyes on 9mobile, noting that it has all it takes to reposition 9mobile and make it attractive and competitive again, within a space of 90 days if given the opportunity to acquire it.
The Central Bank has however promised to carry out a financial check on the winner of the 9mobile auction while the Nigerian Communications Commission will focus on the buyer’s technical competence and quality service to its subscribers.
Etisalat Nigeria, now 9mobile plunged into crisis last year after a consortium of banks seized control of a 45 percent stake from Abu Dhabi’s Emirates Telecommunications Corporation after it defaulted on a $1.2bn loan. The CBN and the NCC, however, stepped in to avoid the collapse of the company. It currently commands a market share of 11.72% in the country.
Smile Telecoms provides a 4G LTE mobile broadband services, with data speeds of up to 21Mbps, in all its countries of operation. It currently has a presence in Nigeria, Uganda, Tanzania.