Teleology Holdings Limited has emerged as preferred bidder for Nigeria’s fourth largest telecoms firm 9mobile and has been asked to pay a deposit of $50 million in March, two sources with knowledge of the deal told Reuters.
Nigerian regulators had set a Jan. 16 deadline to receive binding offers to acquire the debt-laden company. It had said five prospective bidders were in the running.
The sources said only two bidders submitted financial proposals, from which the preferred bidder, Teleology, was selected. They said Teleology had been told to pay a $50 million deposit in March.
Barclays Africa, appointed by Nigerian banks to try to find new investors for 9mobile, recommended Teleology should be preferred bidder, the sources said, adding that Smile Telecoms was named reserve bidder.
A deal could take months to complete as it would involve restructuring 9mobile’s debt, the sources said.
When contacted by Reuters, 9mobile declined to comment.
Teleology is a company led by Adrian Wood, a former chief executive of MTN Nigeria, who helped build the Nigerian arm of the South African telecoms group into the largest mobile phone operator in Nigeria, with a 36.1 percent market share.
The Nigerian Communication Commission (NCC) said on Friday it wanted to ensure 9mobile, formerly called Etisalat Nigeria, was bought by investors with the know-how to run the company.
Etisalat Nigeria took out a $1.2 billion syndicated loan from 13 local banks in 2013 but failed to make repayments last year. Under the stewardship of its lenders, it changed its board, management and name, and is now up for sale.
Airtel had expressed an interest in buying 9mobile but did not submit a bid before the January deadline.
Privately-held Nigerian telecoms firm Globacom and private equity firm Helios Investment Partners withdrew from bidding.
Since the debt issue, 9mobile has lost subscribers. In October, its had 17.1 million users, a 12.2 percent market share, down from 20 million subscribers, or 14 percent share, earlier in 2017, the telecoms regulator said.