Banks to ex­tend 9mo­bile’s loan pend­ing sale – FCMB

Daily Trust - - BUSINESS -

Agroup of Nige­rian banks has agreed to an ex­ten­sion of a $1.2 bil­lion loan made to 9mo­bile, for­merly Eti­salat Nige­ria, pend­ing when the mo­bile op­er­a­tor’s finds new in­vestors, FCMB bank said yes­ter­day.

Nige­rian reg­u­la­tors stepped in last month to save Eti­salat Nige­ria from col­lapse and pre­vent lenders plac­ing the coun­try’s fourth big­gest tele­coms group into re­ceiver­ship, prompt­ing a board, man­age­ment and name change.

Eti­salat Nige­ria took out a $1.2 bil­lion loan four years ago from 13 lo­cal banks to re­fi­nance ex­ist­ing debt and ex­pand its mo­bile net­work, but it strug­gled to re­pay due a cur­rency cri­sis and a re­ces­sion in Nige­ria.

FCMB, which is owed N4.5 bil­lion by the tele­coms group, said lenders had put a hold on tak­ing pro­vi­sions on the debt and that they were work­ing with the reg­u­la­tors.

“In terms of pro­vi­sion­ing, there is hold on that. What we have agreed is an ex­ten­sion and we have agreed to ex­tend pend­ing the sale to new in­vestors,” the bank told an an­a­lysts call, af­ter it pub­lished half-year re­sults.

The banks, many of which are re­port­ing first-half re­sults, have been try­ing to work out the value of 9mo­bile be­fore de­cid­ing whether to im­pair the loan or wait un­til the com­pany finds new in­vestors.

Banks in­volved in the loan deal in­clude: Zenith, GTB, First Bank, UBA, Fidelity, Ac­cess, Ecobank, FCMB, Stan­bic IBTC and Union Bank.

GTB Bank with $138 mil­lion in out­stand­ing loans to 9mo­bile and Ac­cess Bank with $131 mil­lion are among the most ex­posed.

9mo­bile chief ex­ec­u­tive Boye Olu­sanya told Reuters he was fo­cused on get­ting the tele­coms group back on track to make a profit, while work­ing on the pa­per­work to even­tu­ally raise new cap­i­tal. He has also asked the tele­coms reg­u­la­tor for con­ces­sions on spec­trum and for­eign ex­change ac­cess to help to shore up rev­enues.

The tele­coms group has asked Cit­i­group and Stan­dard Bank to find an in­vestor to buy into the firm and three com­pa­nies have shown in­ter­est, a bank­ing source close to the deal said. Reuters

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