By Bassey Udo
February 17, 2010 08:50AM
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Now, Nigerians may soon be able to make and receive calls, using a Nigerian Telecommunications Limited (NITEL) line.

The protracted sale of the national carrier, which has witnessed about four stumbles since 2001, entered a new phase yesterday with the emergence of New Generation Telecommunications Limited as the preferred bidder.

The consortium, which has GiCell Wireless Limited, China Unicom (Hong Kong) Limited, and Minerva Group as members, was announced the winner with a superior bid of $2.5billion after a two-round contest with three other bidders that participated in the financial bid opening , organised by the Bureau of Public Enterprises (BPE).

The bids opening, which was witnessed by officials of the Nigerian Communications Commission (NCC) and members of the committees on Communications in the National Assembly, also featured Omen International Limited (BVI), which was announced the reserve bidder with a bid of $956.98million.

Others include Brymedia West Africa Limited, which submitted a $551million bid (excluding the code division multiple access (CDMA) network system), and AFZI/Spectrum Consortium, which bid $375.5million for the entire NITEL assets, while MTN was the sole bidder for SAT-3 international gateway for $25million.

In line with the provisions of the bid guidelines, the preferred bidder would have to be confirmed by the National Council on Privatisation (NCP) after the submission of a formal report by the BPE.

But, New Generation Telecommunications (formerly Telefonica) is expected to pay 30 percent of the bid offer within 10 calendar days of receiving NCP’s notification of approval, while the balance of 70 percent of $2.5billion is expected to be paid through electronic transfer or bank draft within 60 calendar days.

In event of failure to meet the deadline, the win would revert to the reserve bidder.

Some participants in the financial bid exercise, who spoke on condition of anonymity, commended organisers for a successful and transparent bid, though others, alluding to the experience of the previous failed attempts, expressed optimism that the preferred bidder would meet the deadline to redeem the bid price.

‘NITEL is worth more than $2.5 billion’

However, the chief executive of New Generation Telecommunications, Usman Abubakar, told journalists he was delighted that his company emerged the preferred bidder, adding that Nigerians would witness a revolution in the telecommunications business when they finally receive the confirmation of the NCP to roll out their operations.

“We mean every cent we have offered,” Mr. Abubakar assured.

“We know NITEL is worth much more than $2.5billion. To us, it is a pain to see this national asset decaying without anybody coming to its rescue. Our technical partners, Unicom China, with a subscriber base of 256 million, with over 500,000 base stations, is ready to give the necessary backing that would enable us succeed. To Unicom China, NITEL’s 600 base stations is just like a piece of cake,” he said.

Allaying fears that the company would tread the path of other successful bidders, who failed to meet the deadline for the payment for their bid, he assured that the company would pay within the timeframe stipulated under the bid guidelines.

“Our financiers do not include any of the Nigerian banks. There is a foreign bank that is ready to fund our bid. So, we are not making a hypothetical bidding. We have given a firm commitment to pay what we are bidding, because we already know the value of NITEL,” he said.

In his remarks, BPE Director General, Christopher Anyanwu, said the privatisation, which began in 2001, has been a difficult exercise, saying the latest attempt, which commenced in July last year, went through three unsuccessful attempts to handover the company to Investors International London Limited (IILL), Orascom Telecoms and Transnational Corporation (Transcorp) Plc.

In line with the new privatisation strategy, Mr. Anyanwu said investors would be buying NITEL, along with the mobile subsidiary, MTEL, without the debts, adding that the debts of the national carrier would be settled from the sale proceeds.

http://234next.com/csp/cms/sites/Next/News/National/5527830-146/new_generation_consortium_acquires_nitel_for.csp

good riddance

Let the Chinese business men gobble that one up. Perhaps they'll teach lazy workers a thing or two about work ethics.

Na wa oh

$2.5billion Is that not under priced?

Nepa PHCN should be next!

violent:

Nepa PHCN should be next!

Then the police
Oops! My bad.

snowdrops:

$2.5billion Is that not under priced?

for a dead telecommunication outfit i would say it is a bargain

blacksta:

for a dead telecommunication outfit i would say it is a bargain

It may be dead but that company has a lot of assets including buildings and landed properties in prime location.
Nothing stops these private investors from downsizing and selling some of them.

snowdrops:

$2.5billion Is that not under priced?

Its a very good price the next bid to it was around $800million

We just keep selling everything?
If it was "beyond repair",why would anybody buy it?
Cant we build for posterity instead of selling off all that our predecessors built for us?

Kx:

We just keep selling everything?
If it was "beyond repair",why would anybody buy it?
Cant we build for posterity instead of selling off all that our predecessors built for us?

Looks like you have forgotten how NITEL was before GSM came all the story of changing from analog to digital
It was not any better than NEPA!

Should we still keep deceiving ourselves abeg good job jare!

Jonathan's Goodluck has rubbed off on Nitel!
What a price! I remember Orascom Telecom offered somewhere in the region of $250 million some 3 years ago.
Thats good news men!!

I hope this Chinese firm wont cause crisis in the telecom industry sha. I know they like to crush the markets

Too bad that gov. biz is no man's biz.

Nigeria want it so bad but just want to chop and do no work. Foreigners will work but also chop. So it is better to work and chop than to chop and no work.

Good radiance to bad rubbish!!

Whoever bought that poo was slapped in the face for more cash. . . .
$1.5Billi, i wont even pay. . . .

Quick question to the thinkers:
Why would I pay a bid where the runner up bidded 30% of my bid?
Obviously I overbidded, and will likely not pay.

As per the company, the assets are mostly moribund, nothing has happened in NITEL for years. I doubt their infrastructure is worth $500m anymore.

AjanleKoko:

Quick question to the thinkers:
Why would I pay a bid where the runner up bidded 30% of my bid?
Obviously I overbidded, and will likely not pay.

As per the company, the assets are mostly moribund, nothing has happened in NITEL for years. I doubt their infrastructure is worth $500m anymore.

Thank you. . . . .
The idiots who bought the dead Coy have defo been mugged

Nice one! I hope they pay the money, because it seems as if they over bidded. Well very good for Nigeria, rather than keeping it to decay and to be bought at lower price. Let the Chinese too enjoy doing business in Nigeria. But to be frank this is really long time investment because there are competitors in the market now.

The bids opening, which was witnessed by officials of the Nigerian Communications Commission (NCC) and members of the committees on Communications in the National Assembly, also featured Omen International Limited (BVI), which was announced the reserve bidder with a bid of $956.98million.

I don't get this, why would the winning company bid $2.5bn if the closest other bid is about $1bn?

4 Play:

I don't get this, why would the winning company bid $2.5bn if the closest other bid is about $1bn?

Its a no brainer. . .something is defo dodgy about the reported deal

AjanleKoko:

Quick question to the thinkers:
Why would I pay a bid where the runner up bidded 30% of my bid?
Obviously I overbidded, and will likely not pay.

As per the company, the assets are mostly moribund, nothing has happened in NITEL for years. I doubt their infrastructure is worth $500m anymore.

thats true sha. . .but if they fail to pay then govt will just cancel the bid, i'm sure of that.

but shouldn't nitels stake in SAT3 be worth more than $25mill

netotse:

thats true sha. . .but if they fail to pay then govt will just cancel the bid, i'm sure of that.
but isn't nitels stake in SAT3 worth a bit of dough?

And that should be the only reason why any bidder should pay up to $1 Billi. . . .

Atleast finally,NITEL is to be better than the rot is now,but what about those workers who are awaiting pensionis the chinese gonna pay or the FG the FG can give excuse that it is not their anymore,go meet the chinese and viola no money, Hope that dosent happen but at least we would like to see them again,

MrCrackles:

And that should be the only reason why any bidder should pay up to $1 Billi. . . .  

i had to change the post when i looked and saw mtn bidded $25mill. . .

@the industry ppl
but can we blame the wide variation on the fact that they weren't able to physically inspect the equipment?

blacksta:

for a dead telecommunication outfit i would say it is a bargain

What they priced was their fixed assets and network I think. But other infrastructures like technology and human resources are not worth $1M.

aloy-emeka:

What they priced was their fixed assets and network I think. But other infrastructures like technology and human resources are not worth $1M.

Even the fixed assets are prolly not worth much. . .

MrCrackles:

Even the fixed assets are prolly not worth much. . .

nitel owns some of the best corner plots in naija o. . .

netotse:

nitel owns some of the best corner plots in naija o. . .

No doubt about that but do you think it could have sum up to a sizeable chunk of the bid price valuation

Does anyone who knows about technology know whether the new company can use NITEL's fiber optics infrastructure--the phone lines--to stream DSL high speed internet to customers? And if yes, that would be a significant progress in increasing the number of high speed internet subscribers in Nigeria.

aloy-emeka:

What they priced was their fixed assets and network I think. But other infrastructures like technology and human resources are not worth $1M.

I think the only priced asset Nitel's got is Market access! Access to the Nigerian Telecom Market is priceless by any standard.
Interesting thing is that they got access to  three platforms all in one: Mobile(MTel),  Fixed Line(Good for broadband) and SAT 3.
They know why they paid such a price. If they invest the right amount, they'll get their money back in a short while.
Its the Chinese, their approach to business is different!!