Afrigather Seven years after its majority proprietor, Etisalat UAE, divested from Nigeria, leaving its former subsidiary with $1.2 billion in debt, 9Mobile has a brand new proprietor, a brand new board, and an opportunity of a turnaround.
On July 26, a press release from 9Mobile stated the Nigerian Communications Fee (NCC) had authorized the acquisition of a telecom operator by LH Telecommunications Restricted, a little-known Nigerian firm registered in April 2023 and led by Thomas Etuh, the founding father of the Tak Group of Corporations.
Whereas the NCC hasn’t publicly commented on the deal, an NCC official who requested to not be named stated the fee was conscious of the acquisition, which has been within the works since 2023.
One particular person educated concerning the talks stated the acquisition took a yr due to company infighting after LH took management of 9Mobile in June 2023. The deal represents the newest try to restart progress at 9Mobile, the sickman of the telecom trade.
Based in 2009, 9Mobile began operations as a subsidiary of Emirati-state-owned telecom Etisalat. The corporate shortly racked up new subscribers as tens of hundreds of thousands of Nigerians purchased their first cell phones and SIM playing cards throughout the early 2010s. Authorities assist to drive broadband adoption and a booming financial system buoyed by a commodities increase put 9Mobile as a promising contender in Nigeria’s fast-growing cell market.
However over the past decade, Nigeria has witnessed a reversal in financial fortunes, accelerating inflation and forex devaluation. 9Mobile was impacted on account of its vital greenback debt publicity. In 2017, Etisalat divested from the enterprise whereas a crew from the Central Financial institution of Nigeria and NCC stepped in to discover a new proprietor.
A sale was concluded in 2018, and 9Mobile employed a brand new CEO, Adrian Woods.
But, 9Mobile’s struggles continued. Whereas rival telcos have gained tens of hundreds of thousands of recent subscribers, 9Mobile has misplaced 11.6 million over the last decade. The enterprise is struggling to develop, and its popularity amongst shoppers for good high quality of service is in tatters as community outages, even in city places, have turn out to be frequent.
LH’s acquisition affords a brand new lifeline to the struggling enterprise. It palms management of 9Mobile, Nigeria’s fourth largest telecom firm, to LH, which one publication first linked to LH Telecoms UK, a small UK enterprise that reported 11,000 kilos money on its steadiness sheet as of January 2023.
LH Telecoms UK didn’t reply to emails requesting feedback.
9mobile’s new homeowners, LH Telecoms, didn’t instantly reply to a request for feedback.
Following the deal, LH has assembled a reliable board of executives, together with two extremely influential TY Danjuma members of the family. Between June and November 2023, when Thomas Etuh assumed the place of chairman, the corporate noticed a constant progress of over 400,000 in subscriber base on account of funding launched throughout the interval, stated one particular person conversant in the enterprise.
But, the acquisition isn’t with out controversy. The takeover by LH Telecommunication was opposed by the previous chairman Nasri Ade Bayero claiming the method of naming the brand new board breached company governance ethics, based on one publication and one other particular person with information of the matter.
“The infighting price 9Mobile so much. It led to Thomas Etuh freezing funding throughout the firm, which affected their subscriber numbers between December 2023 and January 2024,” the identical particular person claimed. The particular person stated the funding freeze was to drive the regulator to approve a sale.
The ascension of Etuh as 9Mobile’s new Chairman will draw questions on account of his skilled monitor document and popularity as one of many nation’s high debtors. He has an excellent debt steadiness of ₦11.58 billion owed by his firm Tak Continental Restricted, based on Asset Administration Company of Nigeria (AMCON), the federal company created after the 2008 monetary disaster to deal with debt restructuring of shaky companies.
Etuh beforehand served because the chairman of the board of administrators of Unity Financial institution Plc, Veritas Kapital Assurance Plc, and Lighthouse Capital Restricted. He’s additionally the Notore Chemical compounds Industries Plc board chairman and Jennifer Etuh Basis (JEF).
Notore Chemical compounds, an organization listed on the Nigeria Alternate (NGX), recorded a 33% income loss year-on-year from ₦32.31 billion in 2022 to ₦21.55 billion in 2023 because of the naira devaluation. Veritas Kapital Assurance, additionally listed on the NGX, recorded a income enhance of 41% from ₦5 million in 2022 to ₦7.1 million in 2023.
