The bidders that were selected to acquire the 10 Distribution Companies (DISCOS) and 5 Generation Companies (GENCOS) created from the unbundling of Power Holding Company of Nigeria (PHCN) formally signed the share purchase agreements with the National Council on Privatisation (NCP). The whole process which started eight years ago, with the vision of reforming the power sector was legally backed with the enactment of the Electricity Power Sector Reform Act that provided for the unbundling of the PHCN successor companies. Fourteen investors were selected.
Nigeria expects to raise US$1.26bn from the sale of 10 distribution companies and US$1.06bn from the sale of 5 generation companies. The signing of the SPA comes with a demand for the payment of 25% of the share purchase price for the electricity firms within 15 working days and the balance of 75% of the bid price within 90 working days to complete the transactions. The preferred bidders had paid a total of US$335m, as bid guarantees, of which US$188m for the 10 distribution companies and $147m for the 5 generation companies.
Source: Proshare
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