The Spectrum auction for the deployment of Fifth Generation (5G) technology conducted by the Nigerian Communications Commission (NCC) came to a climax after 11 rounds of bidding that lasted eight hours as Mafab Communications Ltd and MTN Nigeria Plc, emerged the two successful winners of the 3.5 gigahertz (GHz) spectrum auction for the deployment of Fifth Generation (5G) technology to support the delivery of ubiquitous broadband services in Nigeria.
The 3.5GHz Spectrum auction was conducted by the Nigerian Communications Commission (NCC), in collaboration with the Federal Ministry of Communications and Digital Economy in Abuja on Monday, December 13, 2021.
Earlier, three companies which includes MTN, Airtel and Mafab Communications Limited, had qualified for the auction, having met the requirements stipulated in the Information Memorandum (IM) for the spectrum auction.
The three companies took part in a mock auction held on Friday, December 10, 2021, which served as a precursor to the Main Auction conducted on Monday, December 13, 2021.
The three bidders participated in the intensely competitive auction bid in an exercise that clearly demonstrated demand outstripping supply, with Ascending Clock Auction System adopted by the Commission.
In the first Round of the auction, the bid price was fixed at $199,374,000.00; $201,367,740.00 at second Round; $204,388,356.10 at third Round; $209,407,962.50 at fourth Round and $215,782,901.30 at the fifth Round.
The auction prices increased progressively to $224,414,217.43 at the Sixth Round; $231,146,643.96 at the seventh Round; $240, 392,509.71 at the eighth Round; $251, 210,172.65 at the ninth Round; and $263,700,050.00 at the Round 10 of the auction exercise.
The auction process reached its peak at Round 11 when the bid price graduated to $275,904,886.25 with all the three bidders still actively participating. The Main Stage of the Auction then ended at the conclusion of the 11th Round, with Airtel listing an exit bid of $270,000,000, while MTN posted an exit bid of $273,000,000, giving way to the Assignment Stage. At this point, Airtel had dropped off from the race having posted a lower exit bid, thus leaving Mafab and MTN as winners of the two available lots.
The Executive Vice Chairman of NCC and Auction Overseer, Prof. Umar Garba Danbatta, while announcing the results of the Auction exercise, recalled the processes and activities leading to the successful conduct of the auction.
According to the EVC NCC, the Commission published a public notice on its decision to award two lots of 100 megahertz (MHz) Time Division Duplex (TDD) available in the 3.5 GHz band through an auction process to support the delivery of ubiquitous broadband services for the deployment of 5G network in Nigeria.
“Subsequently, an Information Memorandum was issued on November 10, 2021, in which Bid applications for the available spectrum lots were invited. By the deadline for receipt of applications on November 29, 2021, the Commission received applications from three licensed telecoms companies, viz: Airtel Networks Limited, Mafab Communications Limited and MTN Communications Nigeria Limited,” the EVC said.
He noted that the three bidders competed for the available two slots and the Commission adopted the Ascending Clock Auction format which ended after Round 11 and proceeded to the Assignment Stage. “It is my pleasure to announce that at the end of the auction, Mafab Communications Limited and MTN Communications Nigeria Limited emerged as provisional licence winners,” Danbatta said.
Danbatta disclosed that the winning bid price for the auction is $273,600,000 for each lot of 100 MHz TDD and the provisional winners are expected to pay the Winning Bid price, less the Intention-to-Bid Deposit, by February 24, 2022.
He expressed his delight that the auction process was efficient, fair, credible, well-organised and transparent and was designed to deliver the ideal outcome.
The EVC, NCC congratulated the winners and commended the Federal Government for its support and commitment to the deployment of 5G technology in Nigeria, which will bring substantial network improvements, including higher connection speed, mobility and capacity as well as low-latency capabilities to communications services in Nigeria.