Page 7 - AfrElec Week 27 2022
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AfrElec POLICY AfrElec
Nigerian government restructures
five distribution companies
NIGERIA NIGERIA is to restructure five of its eleven elec- collateralised shares of Kano, Benin and Kaduna
tricity distribution companies, all of which are (Fidelity and Afrexim) discos and that they have
privately owned, with a 40% stake held by the initiated action to take over the boards of these
country’s government, Abuja has revealed. discos and exercise the rights on the shares,” a
The affected companies, known as discos, are joint statement from NERC and BPE said.
the Port Harcourt, Kano, Kaduna, Ibadan and “Fidelity Bank’s action is a contractual and
Benin distribution companies. commercial intervention and is between the
Nigerian companies have struggled to reliably core investors in the discos and the lender. BPE
provide power to the nation since 2013, when is involved because of the 40% shareholding of
the government ceded overall control over the the government in the discos,” it added.
companies responsible for distribution. The The restructuring will see independent direc-
five enterprises being restructured have failed tors chosen by the BPE to represent govern-
to repay loans taken out from Fidelity Bank ment interests in the transition. The process will
during the 2013 privatisation, and the bank has also see the government use emergency funds
now exercised its option to take over the firms. through the Nigerian Electricity Market Stabi-
According to the Nigerian Electricity Regu- lisation Facility to support the entities during
latory Commission (NERC) and the Bureau of restructuring and repositioning.
Public Enterprise (BPE), the equity taken over “We are working with the Honourable Min-
by Fidelity will be sold to qualified private sector ister of Power to ensure no service disruptions
investors who will re-capitalise and effectively during these transitions. We remain committed
operate the entities. to supporting the Nigerian electricity supply
“Today we were informed by Fidelity industry to serve Nigerians better,” the state-
Bank that they have activated the call on the ment said.
Week 27 07•July•2022 www. NEWSBASE .com P7
