The Nigerian Electricity Regulatory Commission (NERC) has put Kaduna Electric Distribution Plc (Kaduna Electric) up for sale.
This comes after the sixth largest power distribution company in the country got indebted up to an amount reaching N110 billion ($130 million), just two years after lenders took over in a bid to turn it around.
Kaduna Electric, one of 18 companies created from the 2013 privatisation of the Power Holding Company of Nigeria, serves four northern states. However, it has been plagued by financial woes, a familiar story for many Nigerian power distribution companies. Lack of capital and sub-economic tariffs set by NERC have kept the entire sector struggling for profitability.
The N110 billion debt is owed to the likes of the Nigerian Bulk Electricity Trader and power generation firms. Labelling Kaduna Electric a “failing licensee” under a new law passed last year, the NERC dissolved the company’s board and appointed an administrator and special directors to manage it in the interim.
The regulator said, “The administrator shall be the de facto chief executive officer of KAEDC and shall be responsible for the management of the day-to-day affairs of the utility pending the finalisation of the sale of the undertaking to a new core investor.
“The administrator shall work with a team of special directors that shall constitute non-executive directors of the board for governance purposes. The following are hereby appointed as special directors for KAEDC; Alex A. Okoh, Chairman, Kabir Adamu, Sharfuddeen Zubair Mahmoud, John Ayodele and Rahila Thomas.”
It added that the executive management team that shall work with the administrator would be constituted by the commission and announced in due course.
“The Commission shall administer the sale of the undertaking in accordance with the provisions of the EA on the basis of the highest and best price offered for the undertaking.”
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