The resignations also followed Etisalat Group’s reporting disclosure on the Abu Dhabi Stock Exchange two weeks ago that it had pulled out of Etisalat Nigeria and was transferring 45 percent of its stake and 25 percent of its preference shares in its Nigerian subsidiary to United Capital Trustees, the legal representative of the lending banks. Aside Etisalat Group, other shareholders of Etisalat Nigeria include Mubadala Development Company with a 40 per cent stake and Emerging Markets Telecommunications Services (EMTS), representing the Nigerian shareholders, with 15 per cent.
Etisalat had in 2013 approached a consortium of thirteen local banks for a loan of USD 1.2 billion for network upgrade and expansion. The money was sourced in dollar and naira denominations. However, citing the economic downturn of 2015-2016 and naira devaluation, which negatively impacted on the dollar-denominated component of the loan, Etisalat wrote its creditors informing them of its intention to halt the repayment of the loan in installments, until such a time that it was able to raise more money.
Unsatisfied with the excuse from Etisalat, the banks threatened to take over the operations of the telecoms company should it fail to meet its payment obligations. The situation forced Etisalat to enter into negotiations with the banks, seeking unreasonable write-offs, which the banks rejected.
