FG Brainstorms on Globacom's Offer for NITEL

The Federal Government might have considered Globacom’s bid to acquire the Nigerian Telecommunications Limited (NITEL) through the willing buyer, willing seller option.

THISDAY gathered that the government favoured Globacom because of its experience, clout and reach.
The belief is that Globacom will not just to acquire NITEL, but also to turn around the ailing entity.

The President was said to have been persuaded that two years after the commencement of GSM in the country, Globacom was able to swing the pedulum in telecoms sector by coming from behind to grab the number two position today.

The decision to give it to Globacom despite the fact that some other firms like Brymedia, the third place bid winner of the terminated bid and other firms were offering double what Globacom is offerings was because it will turn the ailing entity around for the benefit of Nigerians.

Though the federal government is said to have invited some interested firms to a negotiation table for NITEL, it has its radar on Globacom.

The fact that the Mike Adenuga-led Globacom had performed a feat in the telecoms sector by taking Glo to such a height, is an attractive option the federal government is willing to adopt to sort out the NITEL crisis once and for all.

Another factor that helped Globacom’s case is the fact that the other companies that participated in the bid and offered huge amounts could not pay what they offered.

The fear in government quarters is that if these firms are having difficulties in paying to acquire NITEL, they will be able to turn it around.

The privatisation process of NITEL was terminated recently by the BPE for the fifth time following the inability of Omen International, the reserve bidder to revalidate its bid for NITEL.

The failure of Omen not too long after New Generations could not come up with the $2.5 billion it offered for NITEL was said to have exasperated the government.

The failed attempt to sell NITEL, made the federal government to decide on the willing buyer willing seller option after President Goodluck Jonathan was presented with three recommendations of the Bureau of Public Enterprise BPE, the government agency that had been charged with the privatisation exercise of NITEL.

President Jonathan was said to have favoured the willing buyer, willing seller option because it is the option that will not only remove the gridlock that a fresh process might entail, but will also address the time factor and all the logistics that will go into conducting a new exercise.

Recall that New Generation Consortium, made up of China Unicom of Hong Kong, Minerva Group of Dubai and Nigeria’s GiCell Wireless Ltd, had in February, 2010 emerged the preferred bidder for the privatisation of NITEL and M-TEL with a price offer of $2.5 billion during the opening of financial bids for the privatisation process.

The reserve bidder, Omen International came second with an offer of $956,996,091, Brymedia emerged third with $550 million and AFZI/Spectrum Consortium, emerged fourth with a bid of 375.5Million.

MTN Nigeria Communications Ltd, bided $25million for SAT-3 only. But since then, the process has been bedevilled with one problem or the other that finally led to its termination. First was the shocking revelation by China Unicom, a partner to some consortium members that they were not part of the deal.

This denial coming almost immediately, the bid winners emerged, threatened the integrity of the process and consumed the job of the then DG of BPE, Dr Christopher Anyanwu