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IILL loses bid to recover $131m Deposit on NITEL

Posted by By Emma Ujah on 2005/07/08 | Views: 519 |

IILL loses bid to recover $131m Deposit on NITEL


Investors International (London) Limited (IILL) has lost its bid to recover the $131.7 million paid to the Federal Government of Nigeria (FGN) as 10% of the bid price for the acquisition of FGN 51% shares in Nigerian Telecommunications Ltd (NITEL) in the aborted first NITEL privatization.

ABUJA—Investors International (London) Limited (IILL) has lost its bid to recover the $131.7 million paid to the Federal Government of Nigeria (FGN) as 10% of the bid price for the acquisition of FGN 51% shares in Nigerian Telecommunications Ltd (NITEL) in the aborted first NITEL privatization.

The Spokesman of the Bureau of Public Enterprises (BPE), Mr. Joe Anichebe, said in a relase in Abuja, yesterday, that an arbitration which handled the matter between the IILL and the federal government ruled in favour of the latter.

The BPE on behalf of the FGN had rejected the claim by IILL for a refund of the amount representing 10% of the US$1.317 billion bid price for 51% equity stake in NITEL, maintaining that the amount stood forfeited going by the terms of the Share Sale Agreement signed by the parties on 28th November, 2001.

The IILL which was selected as prefered bidder in the privatisation of the NITEL could not raise the bid of $1.317 billion and was therefore, told that it could not be refunded the 10 per cent deposit.

IILL therefore went to the Federal High Court Abuja, to seek an order directing the BPE to refund the said deposit.
However, following an application by IILL, on October 17, 2003, the Federal High Court in Abuja presided over by Hon. Justice F.B. Nyako, held that the existence of an arbitrable dispute was a matter for determination by the arbitrators and directed the parties to arbitration. The FGN abided by the court’’s decision.

The matter was thus referred to arbitration before Judge Stephen M Schwebel, a renowned American jurist and one time Judge of International Court of Justice at The Hague. The other two arbitrators were Justice Kayode Eso a retired Justice of the Supreme Court of Nigeria and the Late Justice Muhammad Bello, former Chief Justice of Nigeria whose position was filled, after his demise in November 2004 by Alhaji Abdullahi Ibrahim SAN.

The prelimnary hearings commenced in Abuja on June 18, 2004 during which First Bank of Nigeria led by their legal team made a bid to join the proceedings as interested parties. This was opposed by the lawyers representing the FGN. The objection was upheld by the arbitral tribunal.

Full oral hearings were conducted in Abuja between February 14, and February 18, 2004. Seven witnesses including several banking and financial experts from United States of America, United Kingdom, Spain and Portugal testified on behalf of IILL while three witnesses testified for the Federal Government, the team leader and the assistant team leader on the NITEL privatization in the BPE and a consultant from IBTC who was part of the advisory consortium that advised on the transaction.

IILL attributed its failure to pay the full amount of the shares to the role played by the House of Representatives which had vocally opposed the NITEL privatization, alleging corruption and lack of due process and the subsequent inquiry the House of Representatives instituted on the transaction as well as the resolution passed by the House directing BPE to refrain from executing any agreement or document transferring ownership of the shares, whether temporarily or permanently, to IILL before the conclusion of the investigations.

IILL contended that Government with which it had contracted must take responsibility for the actions of one of its arms, the House of Representatives.

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Okfold(Sobe, Edo, Nigeria)says...

I want the meaning of female owan name Ekeke (Edo state)

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Toluwalase Samuel Olufemi(Ijebu, Ogun, Nigeria)says...

Authority belongs to God, once He decrees it is final and binding

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Ikponmwosa Osamede(Edo, Nigeria)says...

Your meaning of Osamede is wrong. Osamede means God has given me a crown