Power Assets Sale: IBB, Akhigbe, Others Enter Final Lap Tuesday

25 Sep 2012

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Former Military President, General Ibrahim Babangida (rtd)

 By Ejiofor Alike

Bidding consortiums with ties to former military president, General Ibrahim Babangida (rtd), former Chief of General Staff, Vice-Admiral Mike Okhai Akhigbe (rtd), as well as business moguls, Messrs Femi Otedola and Ernest Azudialu, will join other foreign and local investors, who will know their fate today as the National Council on Privatisation (NCP) opens the financial bids for the six generation companies (gencos) being sold under the privatisation programme.

The generation companies include the 300 megawatts (mw) Kainji Hydro Power Station in Niger State; 600mw Shiroro Hydro Power Station, also in Niger State; and the 482mw Jebba Hydro Station in Kwara State.

The other stations, which are gas-fired, include the 414mw Geregu Power Station in Kogi State, as well as the 360mw Ughelli and 120mw Sapele Power Stations in Delta State.
Other investors, whose companies will be entering the trenches for the acquisition of the six assets, include Mr. Tony Elumelu; a former senator, Brig-Gen. Tunde Ogbeha (rtd) and Col. Sani Bello (rtd).

A total of seven bidders were prequalified to have their financial bids opened today. The bidders to watch include Ampirion Power Distribution Limited, a consortium jointly owned by Israeli-based BSG Resource Limited, State Grid Corporation of China and their local partner Forte Oil Plc, an oil and gas marketing and distribution company largely owned by Otedola.

Ampirion was prequalified to have its financial bids opened for Geregu, where it is the sole bidder, and Ughelli Power Stations.

Matching up against Ampirion for the Ughelli power plant will be Transnational Corporation of Nigeria Plc (Transcorp), which is chaired by Mr. Tony Elumelu, whose company Hiers Holdings has the single largest stake in the conglomerate. Another contender for Ughelli is Phoenix Electricity.

Contenders for Sapele Power Station include JBN-Nestoil (Julius Berger Nigeria Plc-Nestoil), which is promoted by Azudialu. JBN-Nestoil will be competing for Sapele against CMEC Energy.

Meanwhile, North South Power Company Limited, which is promoted by Babangida, was the only consortium that submitted bids for the Shiroro Power Station and shall remain the sole bidder for the hydro power plant today.
In the case of Kainji, the other hydro station up for grabs, Mainstream Energy Solutions Limited, promoted by Bello, Akhigbe and Ogbeha, was the sole bidder for Kainji Power Station. Kainji will be sold as bundled company with the Jebba power station.

An NCP source explained that since the two stations are powered by the same river source, they could not be sold separately to different investors as the investor that acquires the station upstream could block the water source that powers the station located at the lower end of the river.

These bidders are expected to be represented by their financial and legal advisors at the financial bid opening, scheduled to take place at 9.30 am at the Transcorp-Hilton Hotel, Abuja.

Following in the path of previous transaction, the highest bidders will be announced as the preferred bidders (subject to final approval of the NCP), following which negotiations will take place on the payment terms and the execution of share purchase agreements before the assets are handed over to the winning consortiums.