9Mobile Undergoes Major Transformation with New Ownership and Board: What You Need to Know

9Mobile Undergoes Major Transformation with New Ownership and Board: What You Need to Know
Image credit: Telecom Review Africa

Acquisition and New Ownership

After seven years of financial struggles and a significant debt of $1.2 billion following Etisalat UAE's divestment, 9Mobile has a new owner and board. On July 26, 2024, 9Mobile announced that the Nigerian Communications Commission (NCC) approved the acquisition by LH Telecommunications Limited, a newly established Nigerian firm led by Thomas Etuh, founder of the Tak Group of Companies.

Background and Acquisition Process

The NCC has yet to make a public statement about the deal, but an unnamed NCC official confirmed their awareness of the acquisition, which has been in the works since 2023. The acquisition took a year to finalize due to internal corporate conflicts after LH assumed control of 9Mobile in June 2023.

Historical Context and Financial Struggles

Founded in 2009 as a subsidiary of Emirati state-owned telecom Etisalat, 9Mobile initially thrived as Nigeria’s mobile market grew rapidly. However, economic downturns, inflation, and currency devaluation in Nigeria impacted 9Mobile severely, especially due to its substantial dollar debt. In 2017, Etisalat exited, leading to a search for a new owner managed by the Central Bank of Nigeria and NCC. A new owner was secured in 2018, and Adrian Woods was appointed CEO, but challenges persisted.

Recent Developments and Controversies

The acquisition by LH Telecommunications provides a lifeline for 9Mobile, Nigeria’s fourth-largest telecom company. LH, linked to a small UK business with minimal cash reserves, has assembled a new board including influential members from the TY Danjuma family. This change led to a notable increase of over 400,000 subscribers between June and November 2023, attributed to new funding.

However, the acquisition has faced controversy. Former chairman Nasri Ade Bayero criticized the board appointment process as a breach of corporate governance ethics. Additionally, internal conflicts led to a funding freeze that negatively impacted subscriber numbers in late 2023 and early 2024.

Leadership Concerns

Thomas Etuh, now chairman of 9Mobile, faces scrutiny due to his track record and reputation. He owes ₦11.58 billion through his company Tak Continental Limited, as reported by the Asset Management Corporation of Nigeria (AMCON). Etuh has previously held leadership roles in several companies, including Unity Bank Plc and Veritas Kapital Assurance Plc. Notore Chemicals, under his chairmanship, reported a 33% revenue loss from 2022 to 2023, while Veritas Kapital Assurance saw a 41% revenue increase during the same period.

Conclusion

9Mobile’s new ownership and board mark a significant shift for the struggling telecom company. While the acquisition brings hope for a turnaround, it also faces challenges and scrutiny, reflecting the complex dynamics of Nigeria’s telecom sector.