How Teleology emerged the preferred bidder for 9mobile
The tides began to turn June last year after the exit of Mubadala Development Company as Etisalats largest shareholder, Mubadala, an Abu Dhabi Government owned investment and development company controlled about 70 percent of the shares in Etisalat along with Etisalat UAE mobile.
This was the left turn that left the Teleco hanging on a thread. Mubadala and Etisalat Group appointed non-executive directors, all nationals of the United Arab Emirates later resigned their appointments leaving only 30 percent shareholding by EMTS promoted by Hakeem Bello-Osagie, a Nigerian.
The genesis of the crisis that lead to the exit of Mubadala was traced to the alleged mismanagement of a $1.2billion syndicated loan procured from a consortium of 13 Nigerian banks; Access Bank, Guaranty Trust Bank, Zenith Bank, Eco Bank, Fidelity Bank, United Bank for Africa, First City Monument Bank, Stanbic IBTC amongst others.
The procurement of a foreign-backed guaranteed bond procured in 2013 was for the financing of a major facelift of Etisalats operational base in Nigeria so as to upgrade and expand.
In the process of all the chaos within Etisalats walls and the consortium of banks over the dept repayment, Mr. Bello Osagie who was the former board chairman was forced to resign. He was later followed by then Chief Executive, Matthew Willsher and other top shots.
The 9mobile Emergence
United Capital Trustees Limited later emerged as the receiver manager appointed by the consortium.
The NCC and CBN later announced the constitution of an interim board for the company which then took 9mobile as its business name. With the appointment of the Deputy Governor of CBN, Joseph Nnanna as Chairman of the Board, alongside, Oluseyi Brickersteth, Ken Igbokwe, Funke Ighodaro and Boye Olusanya who was named the new Chief executive.
The Bid
NCC in conjunction with CBN appointed Barclays Africa as the transaction financial adviser with a mandate to conclude the sale of 9mobile latest by December 31, 2017.
A list of 16 prospective buyers showed up with 5 gallant knights in the forefront ; Teleology Holdings Limited, promoted by the pioneer CEO of MTN Nigeria, Adrian Wood, Smile Telecoms, with operations in over 3 African countries, Helios Investment Partners, Bharti Airtel, the Indian Telecom giant as well as Globacom Nigeria.
But a few visits to the Federal High Court revealed that Spectrum wireless, an investor with about 17.5% shareholding in 9mobile valued at about $35million said no legal decision should be taken to proceed with the sale of 9mobile with factoring their huge investments in.
Spectrum asked the court to halt the planned sale of 9mobile to allow the issue of its investments to be sorted out before the emergence of a new investor. It also said the interim board should not be allowed to remain as security trustee nominee for 9mobile.
Meanwhile Teleology Holdings Limited and smile Smile Telecoms Holdings were submitted to the NCC as the selected preferred bidders and reserved bidders respectively in the recommendation of Barclays Africa.
While Teleology made an offer of $500million, Smile Telecoms reportedly offered $300million with their status subject to NCCs final confirmation.
A New Season
Teleology on Monday November 12, 2018 announced their emergence as winners of the bid by the declaration of the constitution of a new Board of Directors for the Nigerian Telecommunications company. 9mobile.
A statement by the company said the decision followed a successful completion of the tenure of the former Board appointed by the Central Bank of Nigeria CBN and in fulfillment of the consequential transfer of final ownership to the new investors. Teleology Nigeria Limited.
“For us, the composition of the new Board of Directors is another significant milestone, and this follows the issuance of final approval of no objection by the board of NCC to the effect that technical and financial bids Teleology submitted for 9mobile met and satisfied all regulatory requirements. This is indeed the dawn of a new era in the evolution of the 9mobile brand in the Nigerian market”
“We hope to see more stability and impact from Teleology as Adrian Wood who is known for bringing the dead to life in the telecoms industry would be sitting as a driver, fingers are crossed. We hope for the best,” the statement said.
Teleology, a private equity firm with an investment portfolio of $11 billion, offered more than $500 million to acquire the mobile network while Smile offered about $300 million.
According to industry sources, the company was purposely set up to revive the embattled telecom. Teleology is run by the pioneer chief executive officer (CEO) of MTN Nigeria, Mr. Adrian Wood,
Wood is an economist. He was trained at Cambridge and Harvard Universities. He is also the CEO of Brymedia West Africa Limited. After quitting MTN, Wood, an Australian-born launched an unsuccessful bid for Nigeria’s pioneer national operator, Nigeria Telecommunications Limited (NITEL).
The other directors In Teleology are Nasiru Ado Bayero (Chairman), Asega Aliga, Mohammed Edewor, Winston Ndubueze Udeh (Non-Executive Directors), Abdulrahman Ado, an Executive Director and Stephane Beuvelet, Acting Managing Director.
Bayero, who welcomed the appointment, said: “As we begin this new epochal phase, we wish to thank all the employees who built this viable business. Our debt of gratitude also goes to our subscribers even as we assure them to get ready for real best-in-class additional value for their relationship with the 9mobile brand”
According to industry analysts, the immediate task before Mr. Wood and his colleagues is how to bring stability to former 9Mobile (Now Teleology) and immediately assure existing subscribers of their determination to making the telecoms brand competitive again. Until about 15months ago, Etisalat was considered arguably one of the strongest communication brands in Nigeria, but its brand equity began eroding once its core investors pulled out.
Brand expert have said the new owners must immediately address this decline and develop a robust marketing communications strategy that will not just restore consumer confidence in the brand but also attract new subscribers.
Thankfully, Teleology has on its board a team of seasoned business experts with international exposure and adequate understanding of the Nigeria market. And this includes Mr. Woods who played a crucial role in the growth and marketing leadership position of MTN in Nigeria.
At the moment, Teleology is the fourth biggest telecoms brand in Nigeria with over 9 million subscriber base, but it has a lot of work to do if it’s must catch up with competition like MTN which has over 40million subscribers, Airtel with 26million users or Glo with 25million subscriber base.
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