The 13 consortia that beat the Wednesday's deadline for the preferred
bidders to pay the 75 per cent balance of the bid pricesfor the 15
successor companies of the Power Holding Company ofNigeria are set to
take over the firms.
Sources at the Bureau of Public Enterprises, who spoke with one of our
correspondents under the condition of anonymity on Wednesday, said 13
consortia succeeded in making payment for the remaining 75 per cent
before the 5pm deadline.
The successful consortia are: West Power and Gas, the preferred bidder
for the Eko Distribution Company; NEDC/KEPCO, Ikeja Distribution
Company; 4Power Consortium, Port Harcourt Distribution Company; Vigeo
Consortium, Benin Distribution Company; Aura Energy, Jos Distribution
Company; and Kann Consortium, Abuja Distribution Company.
Others who met the payment deadline, according to the source, are:
Integrated Energy Distribution and Marketing Company, the preferred
bidder for both the Ibadan and Yola Distribution Companies; Sahelian
Power, Kano Distribution Company; Transcorp/Woodrock Consortium,
Ughelli Power Plc; Amperion, Geregu Power Plc; Mainstream Energy
Limited, Kainji Power Plc;and CMEC/EUAFRIC Energy JV, which made
part-payment for the acquisition of Sapele Power Plc.
However, two of the intending investors failed to pay the balance as scheduled.
They are: Interstate Electrics consortium, the preferred bidder for
the Enugu Distribution Company, whose members include Chief Emeka
Offor's Chrome Energy, Power House International Limited and
Metropolitan Electricity Authority of Thailand; and North-South Power
Company, the preferred bidder for the Shiroro Power Plc.
The North-South consortium is made up of the Niger State Government,
XS Energy Limited, BP Investment Limited, Urban Shelter Limited, Road
Nigeria Plc, China International Water Electric and China Three Gorges
Corporation.
Going by the rules guiding the privatisation process, the two
firmshave lost in their bid to acquire the power assets as the
reserved bidders will now be given the opportunity to step up and
acquire the companies upon the payment of the bid prices.
Indeed, one of the reserved bidders, Eastern Electric Company, said it
was ready to take over the Enugu Electricity Distribution Company
following the failure of Interstate to pay before the expiration of
the deadline.
It said it was ready to pay $126m for the takeover of the company,
which provides power to the south-eastern part of the country.
The failure of the two consortia to meet the payment deadline, experts
said, confirmed the concerns that a number of the investors were
finding it difficult to raise money from their lenders.
Both companies had met the March 21, 2013 deadline for the payment of
the mandatory 25 per cent of the offer value of their bids by
crediting the account of the Bureau of Public Enterpriseswith $31.5m
and $27,913,633.50, respectively.
The BPE had received a total sum of $559,445,573.96 from all the
preferred bidders as the 25 per cent of their respective bidprices.
Until recently, the failure to meet the deadline would have seen the
forfeiture of the 25 per cent paid earlier. However, the Head, Public
Communications, BPE, Mr. Chigbo Anichebe, told our correspondent said
the rule had been reviewed.
He explained that the BPE would deduct the cost of transaction from
the 25 per cent initial payment and return the balance to the
defaulting preferred bidders.
Sources in the BPE said payments made by the preferred bidders had
already been confirmed by the agency's account department.
Our correspondents gathered that NEDC/KEPCO consortia paid$101m as the
75 per cent outstanding balance for the acquisition of the Ikeja
Disco.
"We paid $96.75m today (Wednesday)," the Chairman, Vigeo Consortium,
Chief Gbolade Osibodu, told one of our correspondents on telephone.
Similarly, the Chairman, West Power & Gas Limited, the
preferredbidders for the Eko Disco, Mr. Charles Momoh, said the
company had finalised the payment for the acquisition of a 60 per cent
stake in Eko Disco ahead of the deadline.
He said the balance payment of $101.25m was made two days ahead of
the BPE deadline; adding that this followed the payment of the initial
25 per cent deposit of $33.75m earlier in March, bringing the total
transaction value to $135m.
Momoh said, "To date, WPG has raised close to $500m in equityand debt
financing to fund the acquisition of the Eko Disco and the significant
rehabilitation and transformation work required to improve
distribution network infrastructure and operations.
"Out of this, $250m has been allocated to rehabilitation, while the
company has allocated a further $48m towards a power purchase
agreement with the Nigerian Bulk Electricity Trading Plc.
"Today marks a tremendous milestone and a major step forward towards
the completion of the most significant privatisation of government
assets in Nigeria's history. The success of the power transformation
programme is critical to the future development of Nigeria.
"WPG, along with the other preferred bidders, fully appreciate
themagnitude of the task before us and are honoured to have been
selected. As a sector, we must work together to ensure we achieve the
desired results."
Eastern Electric Company, the reserve bidder for the Enugu Disco, said
in a statement by its Communication Consultant, Mr. C. Don Adinuba,
said it would not have difficulties raising the funds needed for it to
take over the power firm.
The consortium was formed by the five South-East state governments;
Nestoil, an indigenous operator in the upstream sector of the Nigerian
petroleum industry; Aba Power Limited; Geometric Power Limited, led by
the former Minister of Power, Prof. Bart Nnaji; and the founding
Chairman of Diamond Bank Plc, Mr. Pascal Dozie.
Other members of the consortium are NRECA of the United States, which
operates in Latin America, Pakistan, Sudan and Bangladesh, and
controls 10 per cent of the US' one million megawatt grid; and the
NETGroup of South Africa, which operates the Tanzanian power system
and maintains a significantpresence in South Africa's electricity
business.
Adinuba said, "We have a robust and matchless combination of global
best practices and the best experience of emerging economies. We shall
not have difficulty raising the funds. The Bureau of Public
Enterprises is still holding on to our $10m bank bond raised when we
were bidding for the Enugu Disco.
"As all Nigerians must have known, the 141MW Aba integrated power
project built by Geometric Power and which cost over$450m is about to
be inaugurated."
The Minister of Power, Prof Chinedu Nebo, had shortly after the
Federal Executive Council meeting expressed the hope that the bidders
would meet the deadline as many of them had responded positively as of
Tuesday.
He said, "As many of you already are aware, today (Wednesday) is the
last day for the payment of the 75 per cent of the remaining amounts
of the money owned by the preferred bidders for the generating and
distribution companies that have been privatised.
''And I am very happy to announce to you that we are getting
verypositive results that many of these Gencos and Discos are living
up to expectations.''
[Punch]
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