Reps reject revocation of NITEL sale - Presidency summons senators - NSE suspends Transcorp shares

From Bola Badmus, Taiwo Adisa, and Friday Ekeoba - 19.02.2008

HOUSE of Representatives on Monday reacted sharply to the reversal of the sale of NITEL and M-tel to Transcorp by President Umaru Yar’Adua, saying the action would have a negative effect on the economy of the country. Committee on Communication of the House of Representatives gave the reaction, pointing out that it was capable of scaring foreign investors from Nigeria.

Committee chairman, Honourable Jerry Manwe, stated the position of the House while speaking with newsmen. According to the chairman, the reversal was capable of sending wrong signals to investors that it was risky to invest in the country as another government would come to reverse a previous government’s policy.

“There is far-reaching implication. If I want to come in and invest, what will just cross my mind is that one government will come in and say I am reversing it,” he argued, adding that the step taken by the government on the sale of the two enterprises had negative implications.

However, the committee boss said the House believed the Yar’Adua administration must have a reason for taking the step, pointing out that the House was waiting to know such reasons.

However, the Presidency on Monday moved to stall the review of its decision to revoke the sale of NITEL by the Senate when it summoned the chairmen of the Senate Committee on Communications, Senator Sylvester Anyanwu, and his counterpart in the Committee on Privatisation, Senator Ayo Arise.

Although Senator Arise was not in Abuja to attend the meeting, Senator Anyanwu headed for the Presidential Villa at about 1.00 p.m. on Monday to attend the meeting. Arise was said to have travelled outside the country when the invitation came.

Senator Anyanwu was set to address Senate correspondents in the National Assembly when he called off the briefing to attend the presidential summon.

The two committees of the Senate had on Sunday indicated their intentions to review the decision announced by the Federal Government at the weekend revoking the sale of NITEL and its mobile communication unit, M-tel, to the Transnational Corporation of Nigeria (Transcorp).

Senator Anyanwu, who had indicated the intention of his committee to review the revocation of the sale of NITEL to Transcorp on Sunday, could not attend the scheduled press briefing on Monday.

Sources said a few members of the Committee on Privatisation were also at the Presidential Villa for the meeting. It was gathered that the presidency was shocked by media reports indicating that the legislators were opposed to the revocation of the sale of NITEL.

The Federal Government had, on Saturday, announced through a press statement by the Minister of Information and Communications, Mr. John Odey, that it was revoking the sale of NITEL to Transcorp.

In a swift move on Monday, the Nigerian Stock Exchange (NSE) placed on technical suspension, the shares of Transcorp to prevent its massive dumping by wary investors in the nation’s capital market.

The principal manager, corporate affairs of the exchange, Mr. Sola Oni, said the suspension was in line with the government decision to revoke the sale of NITEL/M-tel to Transcorp.

He said the suspension was placed to enable the exchange to get further information from Transcorp and at the same time protect investors’ interest in the company.

The NSE said in a statement: “We have today placed this stock on technical suspension. The exchange awaits information from the company regarding change of ownership in its shares in NITEL/M-tel as reported in the press recently. All transaction on Transcorp will be at the technical suspension of N4.42 until further notice.”

With this development transaction in the shares of Transcorp would only be at the current price as pegged by the exchange.