Banks plan to drag Etisalat before EFCC over $1.2b failed loan

There are indications that the consortium of 13 banks, which facilitated the $1.2 billion (N541 billion) loan to telecommunications firm Etisalat is suspecting fowl play in the way the fund was managed, which resulted in the foreign investors, the UAE state-run firm, Mubadala pulling out of Nigeria.

The banks are said to have sought the cooperation of the Economic and Financial Crimes Commission (EFCC) to wade into the circumstances that led to the near liquidation of the telecoms outfit despite the funds.

An insider source, pleading for anonymity, disclosed that the banks had, after a closed-door meeting on Wednesday, resolved to seek the help of the Federal Government in unraveling the circumstances that led to the management of Etislat not being able to properly deploy the loan, leading to its failure to service the loan, four years after the deal was sealed .

“The consortium has already drawn the conclusion that there were a lot of issues swept under the carpet, but which the withdrawal of the foreign investors have exposed. They have therefore requested that a proper probe be setup to get to the root of the matter”, the source said.

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He further disclosed that the affected banks had aleady rolled out a number of viable options, including that ownership of Etisalat, as a local company be taken over because the owners had rejected the quest for fresh injection of funds by new investors.

But a senior official of Access Bank, the leading bank in the consortium, who equally asked that his name should not be published put it this way: “The fund in question is public money and the call for an enquiry into what had transpired over it is proper. All we want is to recover the loans; we cannot write it off, despite the demand by Etisalat management.

“Considering their (Etisalat’s) terms, what they are putting forward as a rescheduling proposal is equivalent to almost not having the transaction in the first place.”

It would be recalled that UAE’s Etisalat on June 20 said that it had been instructed to transfer its 45 percent stake in Etisalat Nigeria to a loan trustee. Etisalat said it had been notified to transfer its stake by June 23. It said the stake had a carrying value of zero on its books.

But the concern of the staff of the telecoms firm has been that more than 30 pet cent of the workforce might go, if the banks carried out the restructuring that they have proposed.

 

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