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FG bars MTN, Zain, Glo, from buying M-Tel

By Emma Ujah, Abuja Bureau Chief
ABUJA — The Federal Government has disqualified GSM operators in the country — MTN, Glomobile, Etisalat and Zain  — from buying the mobile telecoms arm of NITEL (M-Tel) in the on-going effort to sell the national carrier.

Director-General of the Bureau of Public Enterprises, BPE, Dr. Christopher Anyanwu, revealed, yesterday, that the decision was based on the advice of the National Communications Commission.

“Nonetheless, NCC pointed out that any of the local operating firms can purchase NITEL alone without M-TEL and SAT3”, Dr Anyanwu said.

The four GSM operators, he said, were part of the 14 telecommunications companies vying for NITEL’s 75 per cent stake as advertised by the BPE in July. The deadline for interested bidders to express interest will close on Monday, October 26, 2009.

The companies that have submitted their applications are Etisalat Nigeria (EMTS); Omen International Limited (BVI); Summit Group; MTI Consortium; Finetek Consortium; MTNL Limited, India; and Globacom Ltd.

Others are MTN Nigeria Communications Limited; Anas Network Services Limited; Telefonica Consortium; Metro PCS Communications Inc; Brymedia (W.A) Limited; Galaxy Backbone Plc and Conau Limited.

Dr. Anyanwu said, “NCC agrees that NITEL should be unbundled into units and each sold separately with all bidders free to buy any combination of units subject to the following regulatory restrictions;

“That the present GSM license holders (that is, MTN, Etisalat, Zain and Glo) are disqualified from buying the mobile arm of NITEL (that is, M-TEL) if NITEL is sold as a single unbundled unit given that they are presently holders of GSM licences.

“To NCC, the purchase of M-TEL by any of the present GSM holders would present competition challenges and will conflict with the regulator’s guidelines and licensing conditions”.

He added that given that Glo and NITEL hold Second National Operators (SNO) licences, “NCC ruled that Glo is disqualified from purchasing a bundled NITEL as it would leave Glo with two SNO licenses and would be anti-competition

The BPE boss said that a reserved price tag would be placed on each unbundled unit of NITEL in proportion of its potential market value and asset base.

NCC subsequently noted the additional advantages of the unbundling strategy and on NITEL’s licence assets.

NITEL holds more than six telecommunications licences, including, Digital mobile license; PNL (fixed wireless land line); Long distance operators’ license; International gateway license; International cable landing right license; and Value-added licenses (ISP and Pre-paid card)

The company also has spectrum licences such as: 1900 MHz band—CDMA fixed wireless spectrum (Uplink and Downlink);

GSM Spectrum (part of DML licenses) (900 MHz & 1800 MHz bands) Uplink, Downlink and various microwave frequencies shared with other operators
NCC had suggested that NITEL be unbundled into the following components:
DML Licence and Infrastructure (M-TEL)

*Long Distance License and Infrastructure (fibre + microwave)
*International Licenses – 3No International Gateway and SAT-3 Submarine Cable Access

*Fixed Network – CDMA fixed wireless, digital switches, external line plants cable network, metropolitan fibre cable networks.  It noted that the CDMA fixed wireless network could be upgraded to a CDMA mobile network if the purchaser obtains a universal access service license; and

*Value Added Services Licenses; that is, Internet service provider, prepaid card, coin box, and internet exchange point.

It is believed that unbundling NITEL would help BPE overcome some of the regulatory barriers as NCC had pointed out that each buyer would likely pay a higher price for the component it values most important for its strategic plan.


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