The Federal Government yesterday announced the revocation of the sale of national telecoms carrier NITEL and its mobile arm M-tel to the Transnational Corporation.
Also, the government has ordered investigations into the management contract of NITEL/M-tel by Dutch telecoms firm Pentascope in 2003.
In a statement in Abuja yesterday, Minister of Information and Communication, Mr. John Odey, said government decided to revoke the sales �because of Transcorp’s failure to achieve the objectives of the privatisation guidelines.�
Odey’s four-paragraph statement reads: �The Federal Government has as part of its efforts in ensuring that due process and the Rule of Law are followed at all times considered various complaints arising out of the sale of NITEL/M-tel to Transnational Corporation.
�This is in addition to the failure of Transcorp to achieve the objectives of the privatisation guidelines, thus making the federal government new position on the sale tenable.
�Accordingly, the Federal Government has approved the reversal of the sale of NITEL/M-tel to Transnational Corporation (Transcorp).
�Additionally, the government in considering this position has also directed that investigation be carried out in the management contract of NITEL/ M-tel by Pentescope.�
NITEL and M-tel were privatised in 2006 after series of botched attempts that further denuded the fortunes of the nation’s telecoms carrier.
Under the sale terms, Transcorp acquired 51 per cent shares of the firm and the federal government retained 49 per cent. Initially Transcorp was allocated 75 per cent shareholding but it failed to pay up the agreed sum and later settled and paid N63 billion ($500 million)
Transcorp yesterday said there was no formal communication to them about the new development.
“We are yet to be informed of the decision of government to reverse the sale,” Mr. Dayo Ojo, Trancorp�s General Manger in charge of Public Affairs told Sunday Trust by telephone yesterday. “And I cannot speak based on hearsay. We are waiting to be informed by the government.”
Asked what Transcorp will do if the decision to reverse the sale is communicated by the government to the company, Ojo said, “Let�s wait until when we are informed. Once we are informed of the decision to reverse the sale, then the company will meet. It is only after that meeting that I will get back to you and inform you of the decision of the company.”
The Bureau of Public Enterprises (BPE), which undertook the sale of NITEL, claimed ignorance of the reversal last night. When Sunday Trust sought BPE�s reaction, its spokesman Joe Anichebe said, “I am now in Awka and I have not been informed on the decision by government to revoke the sale of NITEL and M-tel to Transcorp. I don�t know anything about it and so I cannot speak on the issue when I have not been informed. I will try and get in touch with one or two persons and then I can get back to you.” He did not call back up to the time of going to press last night.
Yesterday�s action is coming after series of calls on government to reverse privatisation transactions done by the former government of Chief Olusegun Obasanjo.
President Umaru Yar�Adua has so far reversed a number of policies and actions of the previous administration, including the sale of Kaduna and Port Harcourt refineries to private investors.
Previous botched efforts to sale NITEL resulted in a management contract given to Dutch telecoms firm, Pentascope. But the Pentascope deal itself was bogged by controversies and allegations of shady deals, which led to the cancellation of the contract.
The management contract had required Pentascope to roll out 600,000 fixed lines above NITEL�s current estimated 500,000 functioning fixed lines. Pentascope was also to put on service additional one million GSM lines above the 118,000 lines within the three-year period.
Pentascope was also expected to improve the operational efficiency of NITEL to achieve 95 per cent call completion rate, while faults per 100 lines were to be reduced to 50.
The privatisation process of NITEL was started in 2001 but ran into troubled waters when the then core investor, Investors International London Ltd (IILL), failed to meet up with the payment of 90 per cent balance of $1.3 billion, leading to the loss of its non-refundable deposit.
Following yesterday�s decision, the federal government is set to dissolve the board of NITEL and M-tel, an authoritative source told the News Agency of Nigeria (NAN).
NAN says a new technical board would be set up under the Minister of State for Information and Communication, Alhaji Ibrahim Nakande. The major task before the new board would be the ceding of the diluted shares of both the federal government and Transcorp to a new core investor, NAN reported quoting an unnamed source.