Local lenders have opposed a proposal by Etisalat Nigeria to convert part of the $1.2 billion loan into naira. Rather, the lenders want its parent, Abu Dhabi telecoms group Etisalat, and its shareholders to recapitalise the telco, it was gathered yesterday.
According to The Nation, a source privy to the negotiations said the seven-year syndicated loan, on which the telco defaulted in payment schedule, has a dollar portion of $235 million which the carrier wants to convert into naira to overcome chronic foreign exchange (forex) crunch at the interbank market.
“Etisalat is asking for us to convert the dollar component to naira but banks don’t want that option and have told them to talk to their parent to settle the loan,” Reuters quoted a banking source as saying. The source said the regulators, the Nigerian Communications Commission (NCC) and the Central Bank of Nigeria (CBN) which had waded into theimpasse and prevented a possible takeover of Etisalat Nigeria are favourably disposed to the naira conversion idea.
Vice President, Regulatory and Corporate Affairs at Etisalat, Ibrahim Dikko, said he would not be able to give update about the outcome of discuissions with the lenders. He promised to do that today.