Teleology Holdings could yet abandon its hard-won acquisition of Nigeria’s 9mobile following reports that the operator’s management has shot down the buyer’s turnaround plan.
After a sales process fraught with obstacles and confusion, the Nigerian Communications Commission (NCC) and Central Bank of Nigeria approved the sale of 9mobile to Teleology Holdings for $500 million in August last year. The unit rebranded from Etisalat Nigeria after the UAE-based group and the investment fund Mubadala withdrew their backing and left the Nigerian market in June 2017 after they were unsuccessful in renegotiating the terms of a $1.2 billion loan.
Teleology had long been cited as the preferred buyer for the unit despite rival Smile Telecoms’ repeated claims that it would be the better owner of 9mobile. Last March, Teleology’s commitment to the sale had appeared doubtful as it neared the deadline for paying a $50 million deposit with no money forthcoming. It eventually handed over the required amount at the eleventh hour.
After this, Teleology and 9mobile formed a joint venture called Teleology Nigeria to undertake implementation. However, reports now indicate that Teleology Holdings founder Adrian Wood has resigned from 9mobile’s board due to his dissatisfaction with the rejection of the turnaround plan, and that as a result Teleology Holdings will pull out of the joint venture.
Wood reportedly stated that “fifteen Teleology experts have worked since June 2017 on detailed 9mobile turnaround planning, development strategies and financial restructuring. This included lining up more than $500 million fresh direct foreign investment from international institutions. 9mobile is an exciting opportunity to build a revolutionary mobile network that could be the pride of Nigeria; unfortunately it appears that we will not be able to participate.”
While Wood’s statement struck a neutral if disappointed tone, other reports indicate a more hostile atmosphere – in particular, there are suggestions that 9mobile’s management were keen to oust Wood and Teleology amid rumours that they were liaising with competitors and pushing to hire Europeans over Nigerians. Regardless of the circumstances, Teleology Holdings stands to lose its $50M deposit.
9mobile also faces leaving its 15 million customers without services after the NCC ruled that infrastructure services provider IHS would be able to shut off the operator’s network.