The government has said that the restructuring of five of the nation’s energy distribution companies is temporary.
The Minister of Power, Abubakar Aliyu, said this in a statement signed by his spokesperson, Isa Sanusi.
The government announced that the Port Harcourt, Kano, Kaduna, Ibadan and Benin distribution companies were the affected electricity companies.
The statement said that qualified private sector investors will buy the bulk of the equity in the companies, re-capitalize and run them profitably.
The entity will be supported as it undergoes reorganisation and repositioning to better serve the residents of the franchise area, the government said.
It added that it will facilitate the activation of emergency funds through the Nigerian Electricity Market Stabilisation Facility.
“The ministry has received confirmation from the BPE and the Central Bank of Nigeria that in exercising the rights of lenders to the core investors, the financial institutions do not retain the ownership of the shares and management of the DisCos in perpetuity,” the statement said.
“Minister has been briefed by Nigerian Electric Regulatory Commission (NERC) and Bureau of Public Enterprise (BPE) on the recent events relating to corporate governance in Kano, Benin, Kaduna, Ibadan and Port Harcourt electricity distribution companies (DisCos) necessitating a change in the respective Board of Directors and Management.”
The statement said the changes announced were as a result of the receivership of the core investors in Kano, Benin, Kaduna and Ibadan DisCos whereas the actions in Port Harcourt are sought to provide much needed liquidity.
“It is therefore expected that clear timelines for exit of the banks would be prescribed by the regulators as and when appropriate,” it added.
“We wish to reassure electricity consumers that the recent changes in the governance of the DisCos would not adversely impact on the ongoing reform initiatives including the National Mass Metering Program,” it noted.
In a reaction to the government’s intentions to restructure the companies, the managers of Integrated Energy Distribution and Marketing Company (IEDM) said they own 60 per cent shareholding interests in the Ibadan Electricity Distribution Company.
A statement by IEDM advised the public to ignore the Nigerian Electricity Regulatory Commission (NERC) and Bureau of Public Enterprises (BPE), purporting to take over control and management of IBEDC.
It said the “purported” takeover was announced “in spite of a subsisting order of court in suit FHC/L/AMC/92/2021 granted on September 8, 2021 and varied on December 3, 2021 respectively.”
It said that IBEDC was unlawfully included in the announcement, adding that the government’s publication was “ill-conceived”.
“The appointment of a Receiver/Manager; Assets Management Corporation of Nigeria (AMCON) and its Nominee,‘Kunle Ogunba have been duly registered at the archives of the Corporate Affairs Commission (CAC), Abuja,” it said.
“The esteemed members of the public are hereby enjoined to ignore the publication as the BPE and NERC both in their individual and collective capacities have no power(s) under any subsisting enactment to take the steps ‘they’ have taken as indeed there is no legislation tagged ‘Business continuity framework’ anywhere codified in the Nigerian Laws.
“The steps as it touches and concerns IBEDC is an affront against due process amounting to contempt of court in the peculiar circumstance, especially in view of the Receiver/Manager’s veritable lien against IEDM’s shareholding interests in IBEDC which have been registered and sanctioned by duly constituted court of law and the concerned authorities aforesaid.
“The general public is hereby informed that the current management of IBEDC remains intact as the Receiver/Manager and its appointed Nominee shall resist any illegal imposition that runs athwart of the spirit and intendments of the recently concluded privatisation exercise in the power sector by the Federal Government and create unnecessary tension and avoidable confusion within the fragile Nigerian Energy Distribution sector.”