The federal government has announced the takeover of Kano, Benin and Kaduna electricity distribution companies by Fidelity Bank Plc after the bank-initiated action to take over the boards of the three non-performing electricity distribution companies.
Also, the government through its Bureau of Public Enterprises, announced that with the takeover of Ibadan Disco by the Asset Management Corporation of Nigeria, the BPE had obtained approval from the Nigerian Electricity Regulatory Commission to appoint an interim managing director for the distressed power firm.
The government further stated in a restructuring notice that it was restructuring the management and board of Port Harcourt Disco to forestall the imminent insolvency of the utility.
The Nigerian Electricity Regulatory Commission (NERC) and Bureau of Public Enterprises (BPE) effected the takeover based on the statutory responsibilities given to them by the government.
The NERC and BPE in a statement issued yesterday, equally announced the sacking of the managing directors of two of the three Discos and also announced their replacements with immediate effect.
The three firms were considered to be technically incapacitated, and financially insolvent after their inability to meet their loan obligations with Fidelity Bank Plc.
The two agencies named Ahmad Dangana as the new Managing Director of Kano Disco; and Henry Ajagbawa for Benin Disco.
They replaced Funke Osibodu formerly of Benin Disco, and Dr. Jamil I. Gwamna, Kano Disco.
However, the Managing Director of Kaduna Disco, Yusuf Yahaya was not affected by the development as he was re-appointed under this new takeover regime.
According to the statement jointly signed by the duo of the NERC Chairman, Sanusi Garba, and Director General of BPE, Alex Okoh, the action became necessary as Fidelity Bank had informed the government that it had activated the call on the collaterised shares of the three companies and, “that they have initiated action to take over the boards of these Discos and exercise their rights on the shares.”
This latest takeover brings the number of Discos taken over by the government to six, as Yola, Ibadan, and Abuja Discos had earlier lost their initial management to the government.
Also, in a statement, the Minister of Power, Abubakar Aliyu, through his Media Adviser, Isa Sanusi, disclosed that he had been briefed by NERC and the BPE on the matter.
The minister confirmed that the Discos were unable to repay loans taken from Fidelity Bank to acquire their asset during the 2013 privatisation, and the bank had activated its right to take over the firms.