The Nigerian Electricity Regulatory Commission (NERC) has dissolved the board of directors for Kaduna Electricity Distribution Company (KAEDC) over its inability to pay N110bn debt owed to the Nigerian Electricity Supply Industry (NESI).
NERC in an order dated January 1, 2024 and signed by its Chairman and Vice Chairman, Sabusi Garba and Musiliu Oseni, respectively, said the order was also due to the receivership of the company not being able to get a new buyer of the company on time.
Daily Trust reports that the KAEDC is among five DisCos that were taken over by their funders after the core investors were unable to pay back the borrowed funds used to acquire the company during privatization in 2013.
Recall that the Managing Director of the company, Yusuf Yahaya, announced his resignation from the company on Saturday.
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The order stated that the company was owing N110bn to the Nigerian Bulk Electricity Trade (NBET) and TCN’s Market Operator (MO) since 2015 till date.
The order stated that the receivership, headed by Afrexim bank, had been given 60 days notice to state why its licence should not be cancelled with another 30 days given in July last year.
It stated that the bank requested for four to six months to finalise the divestment process and that they could not provide the bank guarantees required to secure KAEDC’s market obligation.
The order therefore stated that the failure of the company to get new owner to enable it meet up with its financial obligations has led to “all directors of KAEDC are hereby removed from office and the board of directors stands dissolved in the exercise of powers vested in the Commission by section 75 of the Electricity Act (EA).”
It stated that Dr. Umar Abubakar Hashidu is hereby appointed as the administrator of KAEDC in furtherance to section 75 of the EA.
“The administrator shall be the de facto chief executive officer of KAEDC and shall be responsible for the management of the day- to-day affairs of the utility pending the finalisation of the sale of the undertaking to a new core investor.
“The administrator shall work with a team of special directors that shall constitute non- executive directors of the board for governance purposes. The following are hereby appointed as special directors for KAEDC; Alex A. Okoh, Chairman, Kabir Adamu, Sharfuddeen Zubair Mahmoud, John Ayodele and Rahila Thomas,” the order stated.
It added that the executive management team that shall work with the administrator would be constituted by the commission and announced in due course.
“The Commission shall administer the sale of the undertaking in accordance with the provisions of the EA on the basis of the highest and best price offered for the undertaking,” it said.
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