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Tuesday, June 02, 2009

FG revokes sale of NITEL, MTel to Transcorp,

… Workers applaud step
The Federal Government on Monday revoked the sale of the Nigerian Telecommunications Limited (NITEL) and its mobile subsidiary, MTel to Transnational Corporation (Transcorp) Plc.

This is coming as employees of NITEL and MTel have applauded FG for taking the bold step, describing it as a good omen, even as Transcorp chairman, Prof. Ndi Okereke-Onyiuke has admitted that the corporation’s shares was under-subscribed in 2006.

According to the News Agency of Nigeria (NAN) report, the revocation order was issued at the end of the meeting of the National Council on Privatisation (NCP), presided over by its chairman, vice president Goodluck Jonathan.

Briefing newsmen at the end of the meeting, Minister of State for Information, Alhaji Aliyu Bilbis, said the sale was revoked because Transcorp breached the terms and conditions of the Shares Sales Purchase Agreement (SSPA).

``In the consideration of the serious breaches of the terms and conditions of the SSPA, Council agreed that, Transcorp has vitiated and voided the contract in its entirety. Consequently, Council has approved the immediate revocation of the sale of NITEL/M-tel to Transcorp,'' he said.

Bilbis said the Council also approved the constitution of a Technical Board to manage the affairs of the two organisations until a new core investor was engaged by NCP.

``It also approved the immediate stoppage of further sale of the assets of the organisations as well as a provision of adequate security to all their facilities to prevent any further asset-stripping,'' he said.

The particulars of breaches by Transcorp as highlighted by the Council included the exiting of British telecommunications as the technical operator, which was a condition precedent in the SSPA.

The minister also alleged that Transcorp failed to inject the sum of N8.9 billion cash into NITEL within 100 days of taking over to address the immediate liquidity problem facing the organisation.

``Transcorp was also alleged to have failed to pay interconnectivity debt totaling about N17 billion as well as staff salaries in the past 11 months. The Council also alleged that Transcorp failed to maintain NITEL/MTEL as a going concern, resulting in complete loss of market share from 15 per cent to 0.03 per cent,'' he said.

ITRealms Online, notes that Transcorp took over the management in 2006 after it was declared the ‘preferred bidder’ by BPE in the last quarter of 2005
Transcorp, on Dec. 26, 2006 went to the capital market to raise N60 billion, but got only N22 billion.

The Director-General of the Nigerian Stock Exchange, Mrs Ndi Okereke-Onyiuke, doubles as the chairman of Transcorp, while Mr Tom Iseghohi, assumed office as its Group Managing Director in June 2007.

Reacting to the development, NITEL and MTel employees applauded FG for the action and called for immediate revitalization effort at returning NITEL to its past glory, describing it as a good omen.

The former employees of Transcorp under the auspices of Senior Staff Association of Transport, Telecommunications and Corporations (SSATTC), spoke through their deputy president at MTel, Mr. Chidi Oparauwakwe, told Daily Champion that it is a very good development, because for the past three years, that Transcorp ownership lasted, “they have frustrated and strangulated us and instead of NITEL growing, they were killing us.”

According to him, one of the evidence that TRANSCORP literally killed NITEL was the discovery of about $1.5m and about N15bn by the Economic and Financial Crimes Commission (EFCC) recently from the Group Managing Director, Mr. Tom Iseghohi.

Oparauwakwe also advised the Federal government to ensure they sale it now to a real core investor that would have the workforce at heart or even set up competent Nigerians to manage the corporation.

“It is a very good welcome development. FG can now have the liberty to resale it to the real core investor or even manage as seen in other countries of the world,” he declared.

For the factional president, SSATTC Nitel branch, Comrade Elias Kazzah, his group is aware of the revocation and is still consulting and likely to react officially by today, Tuesday.

“.. But I think it is a positive development and that is what we have been asking them (FG) to do,” Kazzah said.

Equally in his reaction, former President, National Association of Telecommunications Employees (NATE) at NITEL, Mr. Charles Amankwe, affirmed that the revocation is real.

“I want to say that it’s a welcome development, though a belated. Presently, NiTEL is on its knees and FG should set up an interim management,” he said.
Recalling that when Transcorp took over, NITEL was still working, but today, NITEL is not working due to lots of damages massively done and cumulative effect is that Nigeria now has NITEL in comatose.

“So, the new management should see that NITEL is alive before it could be offered for sale,” Amankwe said, stressing that the revitalization of NITEL depends solely on FG.
“All depends on FG plans to revitalize NITEL, may be, by bringing in old hands of NITEL and making relevant fund available. They would turn the place around. I am sure they can turn the place around in good time. No person can go to the market and buy a dead fowl,” he advised.


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