Nigeria’s Bureau of Private Enterprises (BPE) and local operator GiCell Wireless insisted that China Unicom is part of the shortlisted consortium which offered US$2.5bn to acquire 75% of Nitel, after the Chinese operator denied its involvement in the…
Nigeria’s Bureau of Private Enterprises (BPE) and local operator GiCell Wireless insisted that China Unicom is part of the shortlisted consortium which offered US$2.5bn to acquire 75% of Nitel, after the Chinese operator denied its involvement in the process.
GiCell Wireless CEO Usman Gumi said China Unicom Europe had agreed to take part in the bidding as the group’s technical and managerial partner. He told TelecomFinance this could take the shape of an equity participation in the future, of up to 20%.
An official at the BPE, who asked to remain unnamed, also insisted that China Unicom was most certainly a member of New Generations Telecommunications.
An employee at China Unicom Europe said no-one was available to comment at the moment and said the president, William So, is on holiday.
Yesterday, the BPE said New Generations Telecommunications was the preferred bidder in the auction of telecoms incumbent Nitel, which owns a nationwide fibre optic network, the mobile arm M-Tel and access to the undersea cable SAT-3.
However, confusion reigned after several news agencies reported that China Unicom denied any involvement in the process.
Gumi said the group plans to finance its US$2.5bn bid by raising funds with local banks and thanks to backing from its partner, a fund in Dubai named Minerva Group, which he said would own 51% of the equity.
“We will raise the money through loans and guarantees from Nigerian banks,” Gumi said. “We also expect further loans and equity from would-be investors. We’ve already received several expressions of interest.”
Gumi said BGL, the Nigerian investment bank which advised the consortium on the transaction, might also take part as equity partners.
When asked about the huge amount of the bidding price, Gumi dismissed the idea that the valuation was too high. “To us, it’s not high. A few years ago, Etisalat won a GSM licence for US$400m. Yet what Nitel has to offer is so much more; it has a unified access licence, it is commercially operational and owns a wholly built infrastructure including the access to SAT-3,” he argued.
Yet Nitel is also in a notoriously disastrous state – in stark contrast to New Generations, the other bidders offered US$375.5m and US$956m.
Gumi says GiCell is owned by “Nigerian individuals”, without going into details. Launched in 2006, the group offers CDMA coverage in rural areas, claiming to cover 450 rural communities.
Gumi says the group would like to merge GiCell’s CDMA network with that of Nitel. He also said GiCell owns a nationwide GSM licence, further adding to the confusion as the telecoms regulator had banned local GSM owners from bidding for most of Nitel’s assets.
BGL who confirmed its involvement yesterday would not comment any further today.
