Nigeria hands over NITEL and MTEL to international consortium

http://news.yahoo.com/s/afp/20061114...ritaintelecoms


The Nigerian government formally transferred ownership of the state-run telecom firm NITEL to the international Transcorp Consortium, in which British Telecoms (BT) is the technical partner.

"Having fulfilled the condition precedent to the take-over of NITEL and MTEL, I, on behalf of the government, do hereby hand over NITEL and MTEL to Transcorp Consortium," said Irene Chigbue, head of the nation's privatisation agency, the Bureau of Public Enterprises (BPE).

MTEL is the mobile arm of the ill-managed Nigerian Telecommunications Limited (NITEL).

Transcorp Consortium, made up of Transnational Corporation of Nigeria (Transcorp), Etisalat of Abu Dhabi in the United Arab Emirate (UAE) and British Telecoms, last July agreed to acquire a 75 percent equity stake in NITEL for 750 million dollars (600 million euros).

"The BPE had given the core investor some conditions precedent for the takeover as soon as they had completed payment of the first tranche of 500 million dollars (400 million euros)," Chigbue said.

"As we are all aware, Transcorp Consortium completed the payment of 500 million dollars and has thus met one of the key conditions and requirements for today's handover of the company," Chigbue said.

The Consortium is yet to pay the balance of 250 million dollars (200 million euros).

The chairman of Transcorp, Ndi Onyiuke Okereke, said the balance of 25 percent shares in NITEL would be put on public offer when the firm is listed on the Nigerian Stock Exchange by the first quarter of next year.

BT is the operator and a non-equity holding technical partner while the position of Etisalat which is supposed to be an equity holding partner is yet unclear to BPE following a report that it has pulled out from the consortium.

Shortly after the takeover formality, the group managing director of Transcorp, Bernard Longe, announced the appointments of John Weir as the chief executive officer of NITEL and Steve Brookman as boss of MTEL.

Weir and Brookman are staff of BT.

NITEL and MTEL were two government agencies riddled with corruption, mismanagement and ineffiency before their sale.

i think it's sad that our governmental agencies cannot do anything right, and have to outsource management outside the country. what kind of madness is this?

[A-Mugg]

Gbam!

[pynkspyce]

i am sure they could ave sold that sucker to naija investors. it is something that they should have put out as an IPO. they could raised the capital, and had private mgt. Etisalat is a good phone company sha.

This should have gone in the main forum Nita!

[Haleemah]

WHYYYYYYYY ? How is privatisation to foreigners going to help build our expertise??? :frustated

@ Ova Dose,

actually, we are trying to promote the flow of traffic and development of the articles and press releases forum so articles like these need to be here instead of home forum. feel free to contribute too ...

[Kayo]

The bottom line is this was sold to a Nigerian company.Transcorp has done a great job of choosing competent technical partners. Nigeria can only benefit from this.Also remember that technical partners could change in the future once we gain the expertise.Government can't run businesses.

For foreign ownership

Foreign ownership creates a more efficient economy and greater total factor productivity through introduction of new technology and human capital.

Foreign ownership allows the importation of technology at a lower cost than may be available locally. This technology may in turn spill over to the domestic economy through imitation or adaptation, and as technicians, scientists and other employees move on to local firms or self-employment. Even if the majority of research and development is undertaken in the source country, the technology is still transferred to the target country through application, along with the associated economic benefits.

Evidence suggests that foreign firms provide increases in the value of human capital as management best practice, training and worker productivity increments are spread throughout the economy in a similar way.

http://www.aph.gov.au/Library/Pubs/R...-05/05rn34.htm


RIP Milton Friedman.