The Bureau of Public Enterprises (BPE) has unveiled the shareholding structure for the 11 distribution companies created from the unbundling of Power Holding Company of Nigeria (PHCN).
By the structure, 70 per cent of each distribution companies will be sold to core investors and the net proceeds transferred to the Federation Account for distribution to all tiers of government.
The acting director of Electric Power, BPE, Mr. Ibrahim Babagana, made this known while delivering a paper titled, “The Privatisation of the Power Sector: the Journey So Far”, at the Power Sector workshop in Abuja, yesterday.
He added that from the remaining 30 per cent, 10 per cent would be offered equally among all states within the jurisdiction of each distribution firm.
According to him, two per cent of the remaining 20 per cent will be reserved for workers and the balance of 18 per cent will be sold to the general public through Initial Public Offering (IPO) when the companies start performing well.
Babagana explained that the divestiture strategy for the distribution companies will be primarily based on the “use of quality of service/efficiency parameters considered against investment proposals made by bidders aimed at reducing Aggregate Technical, Commercial and Collection (ATC &C) losses over an agreed timeframe.”
He added that the strategy would be built around the Multi-Year Tariff Order (MYTO.)
also claimed that merits of the strategy include emphasis on technical, financial and managerial competence of operators, saying that the development had the shortest curve for reducing subsidies, guarantees and section payment delinquency.