Minister of power, Abubakar Aliyu has disclosed that financial institutions will not continue to retain ownership of shares and management of electricity distribution companies (DisCos).
This was contained in a statement released on Tuesday by the minister while reacting to the restructuring of five DisCos by Fidelity Bank, Export-Import Bank (Afreximbank) and the Assets Management Corporation of Nigeria (AMCON).
He said he had been briefed by the Nigerian Electric Regulatory Commission (NERC) and Bureau of Public Enterprise (BPE) “on the recent events relating to corporate governance in Kano, Benin, Kaduna, Ibadan and Port Harcourt electricity distribution companies (DisCos) necessitating a change in the respective Board of Directors and Management”.
Aliyu said the changes announced were as a result of the receivership of the core investors in Kano, Benin, Kaduna and Ibadan DisCos.
He added that the action in Port Harcourt sought to provide the much needed liquidity as well as prevent the insolvency and risk of collapse of the utility.
“In implementing the changes, the ministry shall ensure that the changes in corporate governance do not impact on the service and stability of the DisCos,” the statement reads.
“We wish to reaffirm that while the government continue to hold a 40 percent equity stake in all the DisCos, the utilities are still private-sector-led ‘going concerns’ falling under the provisions of the Companies and Allied Matters Act (CAMA) and subject to regulation by NERC.
“The ministry has received a confirmation from the BPE and the Central Bank of Nigeria that in exercising the rights of lenders to the core investors, the financial institutions do not retain the ownership of the shares and management of the DisCos in perpetuity. It is, therefore, expected that clear timelines for exit of the banks would be prescribed by the regulators as and when appropriate.
“We wish to reassure electricity consumers that the recent changes in the governance of the DisCos would not adversely impact on the ongoing reform initiatives including the national mass metering program.”
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