The National Council on Privatisation (NCP), barring any change in plans, will offload 30 per cent of its remaining 40 per cent shares in the nation’s 11 privatised electricity distribution companies (Discos) to state governments.
The development follows conclusion of the evaluation of investments made by states in the distribution system pre-privatisation by the Nigerian Electricity Regulatory Commission (NERC).
According to Guardian, the shares will be offloaded in line with the level of investments made by individual states in the utilities prior to privatisation. Only two states, Edo and Zamfara, failed to send in their investment status as at last week.
“Based on the extent of states’ investments, the NCP headed by the vice president will allocate shares to states. At that stage, the states can engage the new owners. Two things can happen: Those shares are jointly owned by both workers and the states, the ones that states have can now be used to engage the new owners in some kind of discussions, around maybe financing. The new owners can then ask them to cash back their stake. The states can also divest,” someone familiar with the matter said.
“Ultimately, when the shares are allocated to states, the new owners can approach the states and have clarity about who their partners are, and new concomitant requirements would be made in terms of financing or corporate governance.”