LAGOS, Jan 25 – Barclays Africa is examining takeover bids from five prospective buyers for Nigeria’s debt-laden 9mobile, two banking sources said, although a deal may take a few months as it will involve restructuring the company’s debt after a default last year.
Barclays Africa, appointed by Nigerian banks to try to find new investors for 9mobile, will make a recommendation to the telecom company later.
“This is not a simple bid. Where there’s a restructuring … investors would state conditions and negotiate what haircut (losses) if any, in respect to trade and financial creditors,” one of the sources told Reuters.
“Time to complete the deal will depend on how quickly advisers analyse the bids and make recommendations to 9mobile.”
Previously known as Etisalat Nigeria, 9mobile took out a $1.2 billion syndicated loan from a group of 13 local banks in 2013 but struggled to make repayments last year, forcing its lenders to step in.
The central bank then intervened to stop creditors from putting it into receivership, leading to a change in its board and management, as well as its new company name.
The crisis forced parent company Etisalat to terminate its management agreement with the Nigerian business and surrender its 45 percent stake to a trustee after the central bank intervention.
Another source said 9mobile’s board and its advisers, regulators and lenders witnessed the bid opening.
“There was screening of a large number of bidders which was narrowed down to five. They were given access to the management and site visits,” the second source said, without naming the bidders.
Since its debt problems came to light, 9mobile, the country’s fourth-biggest operator, has rapidly lost subscribers. In October its users numbered 17.1 million, giving it a 12.2 percent market share, down from 20 million earlier last year, the telecoms regulator said.
South Africa’s MTN, the market leader, has a 36.1 percent share of the market in Nigeria. (Reporting by Chijioke Ohuocha; Editing by Hugh Lawson)