Dubai’s Minerva Group to buy Nitel
Consortium led by Minerva Group to buy 75% stake in Nigeria's Nitel
Nigeria's government has approved the $2.5 billion sale of the country's state-run telecom company, Nitel, to New Generation Telecommunications, a consortium comprising Dubai's Minerva Group, China Unicom, and Nigeria's GiCell Wireless Ltd, ending a protracted process that started eight months ago, according to a report from Bloomberg.
Dubai-based investment house Minerva and its partners will pay an initial $750 million, followed by the remaining $1.75 billion within 60 days, according to a statement sent by Nigeria's Bureau of Public Enterprises to Bloomberg. The government will also sell a bond to pay outstanding wages owed to Nitel's workers, according to the statement.
New Generation Telecommunications originally won the bidding process to buy a 75% stake in Nitel back in February, but the deal was delayed owing to confusion about China Unicom's involvement in the deal.
Analysts have raised concerns about the price of the Nitel stake, which was $1.5 billion more than the second biggest bid.
While Nigeria's population of 150 million people and low mobile penetration rate of about 43% is widely viewed as offering huge potential, the new owner of Nitel is likely to face an uphill struggle turning the company around after years of mismanagement, analysts have said.