The Federal Government on Tuesday said up to 70 percent equity stake in 11 power companies will be privatized. This is in a bid to potentially revive investor interest in the unbundled companies within the Power Holding Company of Nigeria, PHCN.
The shareholding structure for the 11 distribution companies created from the unbundled PHCN has been unveiled by the Bureau of Public Enterprises, BPE.
At a Power Sector Workshop in Abuja yesterday, the acting director of electric power at BPE, Ibrahim Babagana, said 70 percent of each distribution company would be sold to core investors and the net proceeds transferred to the federation account for distribution to all tiers of government.
From the remaining 30 percent, 10 percent shall be offered equally among all states within the jurisdiction of each distribution company.
Babagana informed that two percent of the remaining 20 percent will be reserved for workers and the balance of 18 percent will be sold to the general public through initial public offering, IPO, when the companies start performing well.
The privatization also includes all National Independent Power Projects, NIPPs, currently under construction across the country, which will take effect after completion by the end of 2012.
The NIPPs are Ihovbor Power Station, Benin, Edo State with the capacity of 4 x 125 megawatts (MW); Calabar Power Station, Cross River State with the capacity of 5 x 125MW; Egbema Power Station, Imo State with the capacity of 3 x 125MW; Gbarain Power Station, Yenagoa, Bayelsa State with the capacity of 2 x 125MW, and Sapele Power Station, Delta State with the capacity of 4 x 125MW. Others are Olorunsogo, Geregu, Alaoji, Omoku and Omotosho.
Barth Nnaji, minister of power, revealed this at sideline of the ongoing United Nations General Assembly in New York, United States.
He noted that by privatizing the projects, government would minimize corruption in the system and avoid decay that presently characterized the power situation in the country.
Consequently, the minister vowed to root out corruption in the power sector using all available means to achieve his aims.
According to him, “I want to wipe out corruption in the power sector. The corruption is at two levels: the level of government and workers. The main reason why people are fighting me is because they know that I want to stop corruption in the power sector and not because they don’t like my face. Corruption is the root of why we are not making progress in the power sector and I am determined to root it out. Government will play its total role to make sure that power is available to Nigerians.”
Nnaji, who expressed optimism in the leadership of President Goodluck Jonathan’s government in delivering power to Nigerian people at the end of 2015, noted that nothing was going to truncate the power road map unfolded by the president in 2010.