Vodafone Interested in Nigerian Investment
Vodafone has expressed an interest in buying a stake in Nigeria's state owned land-line and mobile operator, Nigeria Telecommunications (NITEL). Nigeria's Vice President Dr Goodluck Jonathan, speaking after a meeting with Vodafone executives led by the its Chief Executive Officer UK, Paul Donovad said that the government is looking for a speedy privatisation of the company.
However, having been stung by problems when the management was handed to Transcorp - he also stated that any new partner would have to be competent. Under the government plans to privatise the company, Transcorp is expected to be required to relinquish 29% of its 51% stake and the government will offer 22% - allowing any investor to take a majority control. The expected final shareholder profile would end up with the new investor holding 51%, Transcorp with 22% and the government with 27%.
Transcorp originally bought a 75% stake in 2006 in NITEL and its GSM network subsidiary for $750 million during a privatization sale. It could only pay $500 million and acquired 51% stakes in both companies. The government held the remaining 49%.
Workers at NITEL went on strike and cut off one of the country's primary international telecommunications gateways in April in a dispute over unpaid wages.
Vice President Dr Jonathan also called on the other GSM operators to lower their tariffs and boost network capacity so that more Nigerians could access mobile phone services. He noted that a sizeable investor in NITEL could boost investment in the under developed landline network and start to provide suitable competition to the mobile operators.
Vodafone recently took a seventy percent stake in Ghana Telecom, has a 54.9% holding in Vodafone Egypt and is a 50% shareholder in South Africa based Vodacom.
Posted to the site on 10th July 2008
