Etisalat group might sell its stake in Etisalat Nigeria, which has defaulted on a $1.2 billion loan, but wants the company's debt restructured before it does so, according to a Reuters report.

Etisalat group has been approached by Nigerian banks after Etisalat Nigeria failed to make a payment on its loan. According to an unnamed source, Etisalat Nigeria had given notice to lenders that it would miss a February payment which triggered a debt discussion, adding that they were yet to renegotiate the terms. The source added that lenders have asked Etisalat Nigeria to convert shareholder loans on their books into equity and inject fresh capital to free up its cash flows, in addition to asking that Etisalat increase its 40% stake in the local cellco.

Etisalat Nigeria signed a $1.2 billion medium-term facility with 13 Nigerian banks in 2013, which it used to refinance an existing $650 million loan and modernise its network. But an economic downturn, a currency devaluation and dollar shortages on Nigeria's interbank market led to it missing payment, according to Ibrahim Dikko, vice president for regulatory affairs at Etisalat Nigeria.

Banks involved in the loan include: Zenith Bank , GT Bank, First Bank, UBA, Fidelity Bank, Access Bank, Ecobank, FCMB, Stanbic IBTC Bank and Union Bank.