In what would turn noses in many top business schools in the world if it had succeeded, Abu Dhabu, United Arab Emirates-based Etisalat was still looking to have Emerging Markets Telecommunication Services (EMTS) Limited negotiate some form of arrangement that would see the Nigerian company retain it as a technical partner, brand services provider, after what many have interpreted as a fouled departure from Nigeria.
About $520 million of an estimated $1.2 billion loan owed to a consortium of Nigerian banks was outstanding when UAE Etisalat pulled the plug on its involvement in Nigeria, leaving its erstwhile Nigerian subsidiary to carry the can and begin a rebuilding of its business and a new brand in the country, where it has operated since obtaining its licence in 2007 and beginning operations in 2009.
Indeed, Etisalat UAE was actually still negotiating with EMTS in Nigeria with the aim of “putting in place interim agreements for technical services, strategic procurement support and the use of Etisalat brand (and related IP rights),” the company said.
In Abu Dhabi, Etisalat’s base, the company sent a letter to the director general of the securities exchange there Thursday, informing him about the termination of the rights EMTS had to use the Etisalat brand, which analyst said would have been at a fee. The company was believed to have been trying to force a decision in an earlier directive given EMTS to decide within three weeks or stop using the brand altogether, those familiar with the situation told Businessamlive.
In the Thursday’s letter referenced HO/GCFO/152/105, the company told the Exchange that it had become necessary to terminate the rights “since EMTS and the EMTS lenders have decided not to proceed with these negotiations and to use a new brand.” The letter was signed by the Etisalat Group’s chief financial officer, Serkan Okandan.
Part of the letter reads: “Further to our announcement dated July 10, 2017, Emirates Telecommunications Group Company PJSC “Etisalat Group” would like to inform you that Etisalat Group has entered into extensive negotiations with Emerging Markets Telecommunication Services Limited “EMTS” and the EMTS Lenders under the defaulted facility agreement, in connection with putting in place interim agreements for technical services, strategic procurement support and the use of Etisalat brand (and related IP rights).”
The Etisalat group said the purpose of these agreements was to allow for an organised transition to a new brand without adversely impacting EMTS’ ability to operate in the normal course.
“However, EMTS and the EMTS Lenders have since decided not to proceed with these negotiations and to use a new brand.
“Accordingly, the rights granted to EMTS to use the Etisalat’s brand (and related IP rights) by EMTS Nigeria will terminate as of 21 July 2017.
“Should there be any material developments on this subject, a further announcement will be made in accordance with applicable Securities and Exchange rules and regulations,” it concluded in the letter.
Frontpage January 30, 2020