The Federal Government still has 40 percent stake in Electricity Ditribution Companies (DisCos), Engineer Abubakar Aliyu, Minister of Power, has said.
The minister said this while reacting to the takeover of five DisCos by Afrixexim Bank, Fidelity Bank and the Assets Management Corporation of Nigeria (AMCON).
In a statement, the minister said he had been briefed of the development.
“The Honorable 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 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 and prevent the insolvency and risk of collapse of the utility. In implementing the changes, the Ministry shall ensure that the changes in corporate governance do not impact on the service and stability of the DisCos.
“We wish to reaffirm that while the Government continue to hold a 40% equity stake in all the DisCos, the utilities are still private sector led “going concerns” falling under the provisions of the COMPANIES AND ALLIED MATTERS ACT (CAMA) and subject to regulation by NERC.
“The Ministry has received a 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. It is therefore expected that clear timelines for exit of the banks would be prescribed by the regulators as and when appropriate.
“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 Programme.”