Daily Watch

Telecom companies operating in Nigeria are seeing an upsurge in interconnect indebtedness. Industry observers have blamed the debt overhang being owed to mobile operators by the service providers, for the wave of poor service delivered to customers. Poor service delivery has come in the form of dropped calls, incoherent transmission and undelivered text messages. Some mobile operators allegedly deny debtor service providers access to their networks by blocking voice calls originating from them. The interconnect debt which is estimated at over N30 billion could be an early sign of distress in the industry.

The Debt Management Office has announced that Nigeria raised N44 billion ($221 million) at a bond auction last Wednesday, issuing the notes at yields which are higher than its last sale in June. Total bids worth N119.5 billion were received for the 5- and 20- year bonds, the DMO said.

Shareholders of Flour Mills of Nigeria (FMN) have approved an increase in the company’s authorized share capital from N2 billion to N2.5 billion by the creation of additional 1 billion ordinary shares of 50k each, ranking equally with the existing ordinary shares of the company. According to company officials, the increase in share capital is a measure to anticipate future difficulties, and take pre-emptive measures to ensure that the company remains strong.

Cadbury Nigeria posted half year loss before tax of N250.7 million ($1.26 million), compared with a profit of 1.79 billion a year earlier, the company said on Thursday. Its revenues declined by 8 percent to N14.14 billion.