Prof Chinedu Nebo
- Formal handover of companies fixed for October
By James Emejo, Jaiyeola Andrews and Chineme Okafor
The National Council on Privatisation (NCP) yesterday approved the payment of the remaining 75 percent of 14 out of the 15 bidders for the acquisition of the 15 Power Holding Company of Nigeria (PHCN) successor companies.
The National Council on Privatisation (NCP) yesterday approved the payment of the remaining 75 percent of 14 out of the 15 bidders for the acquisition of the 15 Power Holding Company of Nigeria (PHCN) successor companies.
Rising from its sixth meeting in the year, the NCP also approved the late payments by North South Power and Interstate Electric Limited for Shiroro Power Plc and Enugu Distribution Company Plc respectively but subject to the late payment penalty as provided in clause 12.20 on interest for late payment and clauses 5.5, 5.5.1 and 5.5.2 of the Share Purchase Agreement (SPA).
The NCP had approved the payments of the 12 companies which made payments on or before the August 21- due date. They include Amperion Power Co. Ltd (Geregu); Transcorp/Woodrock (Ughelli); Integrated Energy Company (Ibadan); NEDC/KEPCO (Ikeja); Vigeo Power Ltd. (Benin); Aura Energy Ltd. (Jos); Integrated Energy Company (Yola); Mainstream Energy Ltd. (Kainji);
Other are West Power & Gas (Eko); Kann Consortium (Abuja); 4Power Consortium (Port Harcourt); and Sahelian Power SPV Ltd. (Kano).
However, the Council referred the case of CMEC/EURAFIC consortium, the preferred bidder for Sapele Generation Company who had paid $119,887,156 of the $201,000,000 bid consideration to the Office of the Attorney General of the Federation and Minister of Justice for advice. It was gathered that there were legal issues which needed to be resolved.
Chairman of NCP Technical Sub-Committee, Atedo Peterside, speaking with State House correspondents after the meeting meeting, said, "Also, of the five electricity Generating Companies (GENCOS) sold, only four were ratified by the NCP, leaving out Sapele GENCO, over which legal issues arose. The bidder is yet to pay in full".
The NCP also directed the Office of the Accountant General of the Federation to ensure that all PHCN staff entitlements were fully paid by between September 23 and 27.
Apart from that, it also approved the protocol for the physical handover of the successor companies to the bidders that have fully paid the remaining 75 per cent for the acquisition cost.
Director-General of the Bureau for Pubic Enterprises (BPE), Benjamin Dikki, said all payments are scheduled to be completed by September 27, while the formal hand-over of the companies to the new owners would be done in October by President Goodluck Jonathan.
Director-General of the Bureau for Pubic Enterprises (BPE), Benjamin Dikki, said all payments are scheduled to be completed by September 27, while the formal hand-over of the companies to the new owners would be done in October by President Goodluck Jonathan.
Also speaking, Permanent Secretary of the Ministry of Power, Godknows Igali, said PHCN workers' entitlements would be paid with proceeds from sale of the GENCO and DISCO assets.
He said about 26,000 workers had already been paid off, adding that there would be massive post-service training although massive job losses were not expected as many of the workers would be absorbed by the new owners.
He said about 26,000 workers had already been paid off, adding that there would be massive post-service training although massive job losses were not expected as many of the workers would be absorbed by the new owners.
It would be recalled that in December 2010, the NCP advertised for Expressions of Interest (EOIs) from prospective core investors interested in acquiring controlling stake in the 11 successor distribution companies (Discos) created out of the Power Holding Company of Nigeria. By March 4, 2011, the deadline for submission of EOIs, 180 applications were received for the 11 Discos.
Following the evaluation of the applications, 80 bidders were shortlisted. At the deadline for the payment of the data room access fee, 72 out of the 80 shortlisted bidders each paid the mandatory $20, 000 fees to purchase the Request for Proposals (RFP), have access to the data room and proceed to the next stage of the transaction.
All the prequalified bidders were given access to the virtual data room from September 1, 2011 to the proposal submission date of July 31, 2012. Pre-qualified bidders were also allowed to visit the distribution companies and physical data rooms that were located within the franchise area of each distribution company.
By the bid submission deadline of 5pm on July 31, 2012, the Bureau of Public Enterprises (BPE) received 54 proposals from pre-qualified bidders.
The received bids were opened and sorted out on August 1, 2012. All the 54 bids were confirmed to be complete in terms of having both commercial and technical proposals.
Out of the 54 bids, 10 of them failed the first test of completeness and responsiveness. The remaining 44 bids were then subjected to full technical evaluation. Out of the 44 bids, 32 bids submitted by 20 different bidders scored the minimum of 75 per cent that was required to progress to the next stage in the process.
The final approval of the preferred bidders by NCP and its announcement for the successor companies was done on October 23, 2012 for the Discos.
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