Owei Lakemfa

June 10, 2009

The rape of NITEL

By Owei Lakemfa
SEVEN years ago, the Nigerian Telecommunications Plc  (NITEL) was a beautiful bride.  It was courted by many suitors most of them out of lust.  NITEL was the telecommunications gold mine, and many miners, most of them illegal, sought to steal its precious metal.
Admittedly, NITEL, the back-bone of the Nigerian telecommunications system was not efficiently run.

In spite of this, it made huge profits and governments dipped hands in its coffers to fund projects, including the Army. Curiously, when GSM companies were registered, the NITEL licence was delayed giving others a head start.

The Obasanjo administration through the then Director General of the Bureau for Public Enterprises (BPE), Mr. Nasir el-Rufai decided to sell off NITEL. It was part of the privatisation gamble under which public corporations were auctioned at cheap prices, usually to hand- picked people.

In 2002, NITEL’s total connected lines were 555,056 lines out of which 553,471 lines were functional.

That meant that 80 per cent of its lines were in working condition.  That year, NITEL generated N53.41 billion and collected N49.18 billion as revenue.

That was the year the Obasanjo-Rufai group  decided to auction NITEL.  It sold it to the International London Limited (ILL) for $1.2 billion. It turned out that the company was hastily put together by a gang.

Although the Obasanjo government had claimed that its privatisation programme was part of ensuring direct foreign investment flow into the country, it turned out that ILL had no such foreign exchange.

Rather, it sourced the money locally, most of it from the First Bank.

ILL and its local collaborators raised only 10 per cent of the money, and were stuck.  The transaction brought down the First Bank management and the government had no choice but to annul the messy deal.

The el-Rufai BPE, smarting from the collapse of the ILL gambit contrived a new scheme: handing over NITEL to a body called PENTASCOPE ostensibly to properly manage and make it more profitable.  The PENTASCOPE turned out to be a fraudulent arrangement.

NITEL staff, armed with irrefutable evidence on the proposed managment’s incompetence, confronted the Obasanjo-Rufai group and demanded that the management deal with PENTASCOPE should not be consummated.

They led a protest march to the NICON HILTON Hotel venue where the deal was to be consummated.  The Government in reaction said it was putting the signing on hold.  But this was a decoy; the gang went on to sign the dubious agreement.

Handing over  NITEL to PENTASCOPE was like inviting a gang of hungry cats to guard fried fish.

The company wasted no time in sinking its teeth deep into NITEL funds and cleaning out its treasury.

PENTASCOPE “managed” NITEL from March 2003 to February 2005, in those 23 months; the working NITEL lines fell from 553,471 to 291,000.

While in the immediate pre-PENTASCOPE period (2002) NITEL generated N53.41 billion and collected N49.18 billion, under the PENTASCOPE, it generated N29 billion and collected N21 billion.

Apart from the huge revenue loss, under PENTASCOPE there were no new installations, no system upgrade in a digital era and NITEL reaped lots of technical problems.

PENTASCOPE wiped out the NITEL investments in treasury bills with the CBN, and liquidated its credits with the International Telecommunications Union (ITU) and INTELSAT. As it abandoned NITEL, PENTASCOPE left NITEL a liability of N19 billion.

Then the Obasanjo group decided that the BPE directly runs NITEL while a new investor is sourced.

From February 2005 to November 2006 when the BPE ran NITEL, it was a mere continuation of the PENTASCOPE legacy of gross ineptitude and mismanagement.  Even the private pension funds of the staff which PENTASCOPE avoided touching, the BPE group started nibbling.

The BPE  owed salaries, and when the staff protested, the local union, the Senior Staff Association of Statutory Corporations and Government owned companies, now illegally renamed the  Senior Staff Association of Communication and Transport Corporations (SSACTAC) collaborated with the BPE management to identify the protest leaders and victimised them.

The victimisation included punitive transfer and detention in police cell.
Finally, the Obasanjo government announced it had found the perfect company to buy NITEL, it turned out to be the Transnational Corporation of Nigeria (TRANSCORP) a contraption with doubtful origins in which Obasanjo as President had huge shares.

What was also intriguing about TRANSCORP was that it was chaired by the Director General of the Nigerian Stock Exchange, Mrs. Ndidi Okereke-Onyiuke; it was a case of the centre referee in a football game also being the striker of one of the competing teams

TRANSCORP completed the NITEL rape began by PENTASCOPE and the BPE.  Between TRANSCORP and BPE, NITEL choice properties across the country were auctioned at give away prices.

The NITEL Training School which itself is a whole village and the only such school in the country, was sold as were NITEL offices and exchanges.  Even its poles were sold and the staff left without salaries for 11 months.

The NITEL official market share tumbled from 15 per cent to 0.03 per cent. The GSM arm, MTEL which had 1.3 million subscribers, now has a few thousand. Yet at inception, MTEL had the widest reach of all the GSM companies in the country.

The Yar’Adua government’s lamentations that TRANSCORP did not meet any of the sale terms was like shedding crocodile tears; the Government for two years had known that TRANSCORP was asset-stripping and looting NITEL and didn’t stop it.

In any case, the issue now is: What will Yar’Adua and his ‘anti-corruption’ government do?

Will it prosecute all those who so shamelessly raped NITEL? Or would it ascribe this to an act of God and move on to other matters?