New facts have emerged about the indebtedness of Ministries, Departments and Agencies (MDAs) to defunct Nigerian Telecommunications Plc, twenty months after its sale to core investor – Natcom Consortium – at the sum of $252.25 million.
(NITEL) and its mobile arm, Mtel, has put Ministries, Departments and Agencies (MDAs) of government debts to the defunct telecoms firm at N7.984 billion as of July 13, 2016. Private sector debts to the firm as of same date are put at N597 million.
Detailed disclosures pertaining to assets and liabilities of the firm were contained in a report prepared by the liquidator, Otunba Olutola 0. Senbore, dated August 19, 2016 and submitted to shareholders and creditors, a copy exclusively obtained by New Telegraph.
The liquidator was expected to offset NITEL/ Mtel creditors from proceeds of core assets sale.
According to the report, of 186 creditors’ claims processed, the claimed stood at N546.6 billion, verified amount stood at N172. 7 billion; N47.5 billion was paid as liquidation dividend while total receipt stood at N51.6 billion.
“The total liquidation receipt constitutes 29.90 per cent of total verified claims, while dividends paid represent 92 per cent of the liquidation income,” the liquidator report noted.
According to the report, liquidation dividends paid to general creditors were approved by committee of inspection on following dates: 15 per cent of verified claims which was paid on 12th May, 2015; 12 per cent of balance paid 16th November 2015 and 1.5 per cent of balance paid on 11th July 2016. The liquidator expressed frustration at the recovery prospect of outstanding debts owe by private sector.
“The liquidation dividends paid to creditors could have been higher if we were able to achieve recovery from government sector debtors. We made progress in the recovery of NITEL debts in the private sector, but we were not able to recover the debts of government sector customers of NITEL.
The outstanding government sector debts amounted to N7.984 billion as at 31 July 2016 whilst the outstanding private sector debts amounted to approximately N597.50 million as at the same date.
“In our reconciliation of the various bank accounts of NITEL and Mtel, we succeeded in achieving certain recoveries. However, we are in discussions on some items that we hope will succeed in actual recoveries soonest,” the liquidator added.
NITEL net deficiency on assets on liabilities as at March 20, 2014 amounted to N98.75 billion, while that of Mtel net deficiency on assets stood at N49.01 billion as at December 31, 2006,” the report added.
The creditors to NITEL/ Mtel had, in a petition two weeks ago addressed to Financial Reporting Council of Nigeria (FRCN) and the Presidential Advisory Committee Against Corruption (PACAC), alleged default payment by the appointed liquidator.
Signed by a representative of the creditors, Mr. Sebagen Henry Noboh, and dated October 20, 2016, the complainants in the petition decried what they considered lack of accountability in the payment of their claims.
According to them, the liquidator paid only 16.5 per cent of the amount stated in his offer letters to individual creditors, leaving a balance of 83.5 unaccounted for. The offer letters, dated May 12, 2015 were personally signed by the liquidator.
They added that the 16.5 per cent was paid to them in two installments of 15 per cent in May 2015; and 1.5 per cent in July 2016, an interval of 14 months.
The liquidator had faulted the claim, explaining that creditors of the telecom firms were being paid on progress of recoveries. He added that he had, on several occasions, asked for patience from them.
The liquidator, in the report, claimed that: “Both NITEL and Mtel were indebted to the commercial banks as at March 2014.
Whilst NITEL did not use its assets as collateral for its borrowings, MTEL did and in fact, had an all assets debenture on its assets.
The Assets Management Corporation of Nigeria (AMCON) has taken over the loans from the banks, thus holding the debentures on all Mtel’s assets as at 14th March 2014. The debenture covered all the equipment of Mtel and its licence.
AMCON claimed that both NITEL and Mtel owe it N107 billion as at 14 March 2014.” The defunct NITEL/ Mtel stopped operations since 2008/2009 and laid off the majority of their staff. NITEL was eventually sold to Natcom Consortium for $252.25 million last year after five failed previous attempts.
The federal government, through the National Council on Privatisation (NCP) had approved the privatisation of the firm through a guided liquidation process strategy in accordance with the provision of the Companies and Allied Matters Act (CAMA) LFN 2004 and the public enterprises (privatisation and commercialisation) Act of 1999.
