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Slug: Sale of NITEL to Transcorp: Letter to Sain Atiku By Senior Fyneface Port Harcourt
If President Olusegun Obasanjo has the option of being considered someone dishonest or someone incompetent who does not know what goes on within his economic circle of “experts”, he would prefer the second version.
Four years ago, IILL offered to buy NITEL without its GSM subsidiary- M-TEL for a sum of $1.3 billion.
In December 29, 2005 Orascom Telecom of Egypt offered to buy the same company for about $250 million and this was to represent 51 percent equity shares of NITEL. The company was also to take over all NITEL’s liabilities including pensions and salaries of over 12, 000 employees of the utility giant.
Earlier this year, the owners of V-Mobile sold 65 percent of the company’s equity holdings to Celtel of Holland for $1.05 billion. Remarkably the entire assets of V-mobile represent an infinitesimal fraction of what NITEL has as assets.
Commendably, the President’s super economic team after several knotty negotiations and deals, finally sold NITEL to TRANSCORP for a sum of $750 million. The company with the new deal now owes 75 percent equity shares as against the 51 percent originally dangled for sale by the Bureau of Public Enterprise (BPE).
In the deal, Transcorp was spared the stress of settling NITEL’s liabilities. The federal government will be responsible for all the liabilities of the telecom giant.
TRANSCORP is expected to pay $500 million within seven working days that is probably on or before 15th of July 2006 and pay the balance of $250 million subsequently (no specific time frame).
NITEL’s liabilities- pension of workers and staff salary arrears currently stands at over $700 million. This is minus debts owed legions of contractors which stand at over two times the total amount TRANSCORP has promised to pay for the telecom giant.
M- TEL’s GSM license in 2001 costs $285 million. This is in addition to the huge investment in facility upgrade and new installations across the country for the mobile service. This mobile subsidiary of NITEL was equally stuffed into the TRANSCORP deal.
To assess the SAT- 3 transatlantic optic fibre cable, NITEL paid over $100 million with initial deposit of $50 million.
NITEL has a large trunk of carrier network which is being used by other GSM service providers and private telecom operators in addition to the over 80 percent of the nation’s fixed telephone lines under the control of the utility giant.
I know that NITEL has 6.9 percent equity shares in the Regional African Satellite Organisation (RASCOM), 0.21 percent share in International Maritime Organisation (INMARSAT), 0.60 percent shares in International Telecommunication Satellite Organisation (INTELSAT), and 0.07 percent shares in the Global Communication Limited.
President Olusegun Obasanjo’s elite super- economy- on- paper tigers had alleged that the sin of Vice President Atiku Abubakar against his boss was that, as chairman of the National Council on Privatisation (NCP), he literally bought over all the enterprises that were privatized under him using different people as fronts.
Under Atiku Abubakar as functional chairman of NCP, National Oil and Chemicals Limited was sold to Dr Mike Adenuga of Conoil. Benue Cement Company Oturkpo, Savannah Sugar Company, Numan and Oshogbo Steel Rolling Mill were sold to Alhaji Aliko Dangote. National Unity Line was sold to Chief Femi Otedola. Idorama Group of Indonesia in conjunction with their Nigerian Partners (one a governor, one in the presidency) bought Eleme Petrochemicals Company. Chief Jimoh Ibrahim and Engr Mike Orugbo bought National Fertilizer Company of Nigeria (NAFCON) and NICON Insurance Plc.
Of over 60 enterprises privatized since 1999 under Vice President Atiku Abubakar as chairman of NCP, only one, and an unattractive one for that matter, African Petroleum, was bought by someone that may described as a friend of the VP, the Ibusa-born US-groomed businessman and industrialist, Chief Peter Okocha of Sadiq Petroleum.
Recent happenings in the annals of privatization of public-owned enterprises have seen TRANSCORP bought, among several other very viable enterprises, NICON Hilton Hotel and now NITEL.
Let’s I forget, Global Infrastructure was assigned to manage the Ajaokuta Steel Complex and Nigerian Iron Ore Mining Company, Itakpe in deals sealed in the Presidency outside the BPE.
In the spirit of transparency and accountability as being preached by this administration, I think the unfolding events involving sale of public enterprises has increased the demands for clarification on the disposition of some of these assets particularly the nation’s steel companies, Rolling Mills and the Aluminum Smelter Company.
Nigerians would be glad to get honest answers to the following questions: Who are the owners of TRANSCORP? And will the owners of TRANSCORP be honest enough to make public details of payment of the first $500 million which is expected before 15th July, 2006 and the subsequent payment of the balance of $250 million?
Who are the Nigerian partners of Indorama that got Eleme Petrochemicals free of charge technically speaking, amongst other juicy contracts and asset buy-offs? Who owns Global Infrastructure? Why did the Presidency will-out the Aluminum Smelting Company Limited (ALSCON), Ikot Abasi to RUSAL of Russia in a deal that technically means zero- financial commitment for the Russian Aluminum giant? Who are the Nigerian stakeholders in Rusal Nigeria? Who are the Nigerian partners of General Electric of USA in Nigeria, the company that got the sole right to execute the Niger Delta Gas Turbine Project involving the six states of the Niger Delta?
The most interesting part of the unfolding events involving the President’s economic team is that it looks like Nigerians are beginning “to see some light at the end of Obasanjo administration’s eight-year dark tunnel” after all, the cardinal gospel of this administration has been transparency and accountability which means light, a bright one indeed. Who knows, sooner than we think, everybody will give account of his/her stewardship on the public confidence entrusted to them. If not to the Nigerian people, it will be to God.
SENIOR FYNEFACE IS A PORT HARCOURT-BASED VETERAN JOURNALIST/ PUBLIC AND GOVERNMENT AFFAIRS ANALYST.
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