Liquidation of Nitel assets put on hold

8 Views Comment Off

The planned liquidation of Nigeria’s embattled incumbent operator Nitel and its mobile arm, M-tel, has bogged down in confusion after the country’s lawmakers directed the agencies responsible for the sale to hold investigations.

Members of the House of Representatives directed the National Council on Privatization and the Bureau for Public Enterprises (BPE) to suspend the planned liquidation of the two companies until the investigations are concluded.

The Nigerian government is liquidating Nitel and M-tel following several failed attempts to sell the companies. The decision to liquidate the companies was made last week by the Nigerian government’s National Council on Privatization, headed by the country’s vice president, Namadi Sambo.

But the lawmakers have resolved to carry out an investigative hearing into the planned sale in an effort to block the Nigerian government from selling the company’s assets at low prices. The lawmakers say they are concerned about the Nigerian government selling national assets at extremely low prices while getting kickbacks in the process.

The lawmakers said they are worried that both the National Council on Privatization and the BPE might sell the two companies’ assets at an amount that is far less than the cost of procuring a GSM license anywhere in the world. The SAT3 submarine cable as well as various exchanges, transmission stations and cabling networks are up for grabs.

“Consequently, the committee on privatization and commercialization, communication, procurement, Finance and Information Technology has been mandated to conduct public hearing on the liquidation,” Tajudeen Yusuf, a member of the House of Representatives who sponsored the motion in parliament told Nigeria’s The Moment Newspaper March 15.

The sale figures of the two companies’ assets approved by the Nigerian government have not yet been made public but Yusuf said the figures do not reflect the true status of the companies.

According to Yusuf, both the National Council on Privatization and the BPE have undervalued and underpriced Nitel and M-tel.

Over the past decade, the Nigerian government has repeatedly failed to privatize Nitel, with various international telecom companies disqualified from the bidding process. Lawmakers have raised complaints that the bidding process itself was manipulated and that bribes were offered to BPE officials to manipulate the outcome.

Several African governments including Zambia and Ghana have faced problems in privatizing incumbent operators. Generally, corruption and lack of transparence among senior government officials have been at the root of the problems.

In : Finance

Related Articles