Econet Wireless remains on top of Nigeria compensation case

A court in Nigeria has dismissed an application by Bharti Airtel to set aside an award made by an international commercial arbitration tribunal in favour of Econet Wireless.

Econet Wireless says that it is now going to seek compensation in excess of US$3 billion for damages following the sale of the Nigerian mobile network against its wishes. The size of the actual damages has yet to be assessed by the court.

The basis of Econet’s claim is that its five per cent stake was unfairly cancelled when Zain Group took control, so any decision made since then without it, including the later sale to Bharti Airtel is void.

An international tribunal found multiple breaches of a shareholders’ agreement by both the selling shareholders and Celtel Nigeria, now Bharti Airtel Nigeria, ordering them to pay compensation to Econet.

The ruling said that the purchase of a 65 per cent shareholding in Nigeria’s second largest mobile operator, by Celtel, violated the pre-emption rights of existing shareholder, Econet Wireless. Celtel’s parent company, Zain Group later sold the controlling stake to Bharti Airtel. The international tribunal’s award was handed down in December.