Etisalat Nigeria is currently working with lenders and Abu Dhabi state investment fund, Mubadala, to resolve its debt problems brought on by a devaluation of the naira currency.

The telecoms company has been in talks to restructure a $1.2billion loan after missing a payment deadline, but sources with knowledge of the matter had said that the talks reached a deadlock on April 28.

Responding to reports that Mubadala was pulling out from Etisalat, a spokesman of the company, Brian Lott on Friday told Reuters that the report was wrong. According to him, several proposals are currently being discussed.

Etisalat Nigeria had requested that its lenders take equity in the business and convert the dollar part of its loan to naira. The lenders refused and had instead asked the parent company of Etisalat Nigeria to inject more cash, but the Abu Dhabi-listed Etisalat was not prepared for additional investment after it had converted a part of its affiliate’s loans into equity and reduced its investment to $50milllion.

Etisalat Nigeria in 2013, obtained a seven-year loan facility from 13 local banks to refinance a $650 million loan as well as the expansion of its network but the company had missed the payment due to a dollar shortfall in Nigeria’s financial system. This was caused by low oil prices and economic recession.

Anita Fatunji