Privatisation: Bidders pay $156.60m for five power companies

By NOEL ONOJA

A total of $156.60 million or N24.9billion has being paid to the Federal Government by four bidders who emerged as core investors in the PHCN successor companies.

The money, which represents 25 percent of the bid value for five of the companies, is a mandatory payment for the acquisition of generation and distribution companies put up for sale.

A breakdown of the list of companies that have paid, which was obtained by Vanguard include:

·         Amperion Power Company Limited – $33 million for Geregu Power Plc
·         Integrated Energy Distribution & Marketing Company – $42.25 million and $14.75 million respectively for Ibadan and Yola DISCO
·         NEDC/KEPCO – $32.75 million for the Ikeja DISCO
·          West Power & Gas – $33.75 million for Eko DISCO

*PHCN transformer

The payments are coming ahead of the Thursday, March 21, 2013, deadline for all the bidders to make the mandatory 25 percent payment in line with the Share Purchase Agreements, SPAs, signed for the transactions.

Yet to pay

Other bidders for the PHCN successor companies that are yet to pay are:

·         4Power Consortium(Port-Harcourt Disco); Aura Energy Limited (Jos Disco)

·         Interstate Electrics Limited (Enugu Disco)

·         KANN Consortium Utility Company Limited (Abuja Disco)

·         Sahelian Power SPV Limited (Kano Disco)

·         Vigeo Consortium(Benin Disco)

·          Transcorp Consortium (Ughelli Power Plc)

·         CMEC/EUAFRIC Energy JV  (Sapele Power Plc)

·         Mainstream Energy Solutions Limited (Kainji Power Plc)

·         North-South Power Company (Shiroro Power Plc).

Under the guidelines provided by the Technical Committee of the National Council on Privatisation, NCP, the core or preferred bidders risk losing their bids for the respective companies if by Thursday the remaining nine companies are unable to raise the mandatory fees.

The bids will automatically go to the reserved bidders, usually the second highest bids quoted for the companies, except where the NCP decides otherwise based on the rules guiding the transactions.

The final approval of the preferred bidders by NCP and its announcement for the successor companies was done on October 23, 2012.

The Nigerian electricity industry has been unbundled into generation and distribution companies, and a single transmission company. This was done with a view to encouraging private sector participation and attracting foreign and local investments into the power sector to ensure economic and reliable electricity supply.