The Federal Government on Thursday handed over the N105.3bn Afam Power Plant to Transcorp Power Consortium based on the approval of the National Council on Privatisation.
Director-General, Bureau of Public Enterprises, Alex Okoh, handed over the power plant to the preferred bidder on behalf of the Federal Government in Abuja.
This came as the BPE also announced that the lingering tussle over who owns the Aba ring-fenced area between Geometric Power and Interstate Electric (owners of the Enugu Electricity Distribution Company) had finally been laid to rest with the signing of the Asset Sale Agreement between the two firms.
Earlier this month, The PUNCH reported the signing ceremony for the official sale of the Afam Power Plant during an event that was held at the Office of the Vice President in Abuja
In October last year, the National Council on Privatisation approved Transcorp Power Consortium as the preferred bidder for the Afam Electricity Generation Company (Afam Power Plc and Afam Three Fast Power Limited) with a bid price of N105.3bn (about $343.6m).
This was one of the major decisions taken by the council, chaired by the Vice President and Chairman of Council, Prof. Yemi Osinbajo, at the 2nd Meeting of the NCP for 2019 on October 14, 2019.
Speaking at the handing over event in Abuja on Thursday, Okoh explained that after the previous failed attempt to privatise Afam Power Plc and the approval granted by NCP for the recommencement of a new process, the BPE commenced a competitive privatisation process for the plant.
This, he said, culminated in Transcorp Power Consortium emerging as the preferred bidder with a combined offer of N105.3bn.
He said Transcorp Power Consortium paid cash of 25 per cent of the bid amount on Thursday, November 26, 2020, which was a condition precedent to the current activity of handing over.
Okoh said, “I must add that my emphasis on cash payment is to correct some misinformation in the media that purported that the Afam deal is a mere reconciliation of figures between the Federal Government and Transcorp.
“For the benefit of those who wish to know, this idea was never accepted by both the NCP and its several sub-committees. However, with the payment of the money by Transcorp to the treasury today, we hope this unfounded and concocted information being fed to the public would stop.”
The President, Transcorp Power Consortium, Tony Elumelu, expressed gratitude to Federal Government and gave assurance to work with the state government, host community and residents to fast track development in the area.
On the asset sale agreement between Geometric Power and Interstate Electric, the bureau said the deal was signed in Abuja on November 26, 2020.
Okoh said the agreement marked a significant milestone in the process of the power sector reform given the long drawn process of the transaction.
He tasked Geometric Power to transform Aba and Ariara Business Units into a model distribution franchise by providing stable electricity supply and enabling the industrial hub to flourish.
Recall that an agreement was entered into between the Federal Government, National Electric Power Authority and Aba Power Limited on April 28, 2005.
The parties executed a supplemental agreement on August 31, 2006. The area of coverage delineated by NEPA through the lease agreement was referred to as Aba and Ariaria Business Units, to which the initial agreement gave an exclusive right to APL to operate.
Following the privatisation exercise of the Federal Government in 2013, Interstate Electric acquired 60 per cent of Enugu Electricity Distribution Company from the BPE.
This was pursuant to a Share Sale and Purchase Agreement dated August 21, 2013 between the BPE and Interstate and a number of other agreements signed with them.