UAE-based investment fund Mubadala reportedly “pulled out” of Etisalat Nigeria, after the operator failed to renegotiate the terms of a $1.2 billion loan it took four years ago.
According to Reuters, Nigeria’s central bank issued a statement announcing the fund had pulled out of the company, and abandoned ongoing negotiations with Etisalat’s lenders, which it had entered to prevent job losses and asset stripping.
Etisalat Nigeria took out the loan with 13 Nigerian banks in 2013, and repaid $500 million of the loan before defaulting on its payments in February this year.
Mubadala reportedly owns 40 per cent of Etisalat Nigeria.
Parent company Etisalat said on Tuesday it was carrying a 45 per cent stake in the Nigerian company at nil value, and it had been ordered to transfer its shares to a loan trustee following the failure of negotiations, reported Reuters.
It all means Etisalat Nigeria’s only remaining investors are its Nigerian partners, led by company chairman Hakeem Belo-Osagie, according to reports.
Etisalat Nigeria’s February default was attributed at the time to an economic downturn in the country, currency devaluation and a shortage of US dollars on the country’s interbank market.
The central bank and Nigeria’s Communications Commission then stepped in after lenders tried to take the business over or place the firm into receivership, agreeing to pursue a beneficial deal for all parties.
Nigerian website PM News added that representatives from the central bank and Nigeria’s regulator would hold talks with lenders in the next few days.