Fidelity Bank To Take Over Indebted DisCos

Fidelity Bank says it has planned to collateralise the shares and take over the boards of Kano, Benin and Kaduna Distribution Companies (DISCOs).

This was revealed in a joint statement by Alex Okoh, the Director-General, Bureau of Public Enterprise (BPE),  and the Executive Chairman, Nigerian Electricity Regulatory Commission (NERC), Sanusi Garba on Wednesday in Abuja.

“Today, we were informed by Fidelity Bank that they have activated the call on the collateralised shares of Kano, Benin and Kaduna (Fidelity and AFREXIM) DISCOs.

“They have also initiated action to take over the Boards of these DISCOs and exercise the rights on the shares.

“Fidelity Bank’s action is a contractual and commercial intervention and is between the Core Investors in the DISCOs and the lender.

“BPE is involved because of the 40 per cent shareholding of the government in the DISCOs.’’

The statement reveals that the new board members of the affected Kano DISCO are, Hasan Tukur, as Chairman, Nelson Ahaneku, and Engr. Rabiu Suleiman as members.

According to the statement, Benin DISCO would have K.C. Akuma, as the Chairman, Adeola Ijose and Charles Onwera as members, and Kaduna DISCO would have Abbas Jega as Chairman, and Ameenu Abubakar and Marlene Ngoyi as members.

The statement says BPE had nominated Bashir Gwandu (Kano), Yomi Adeyemi (Benin), and Umar Abdullahi (Kaduna) as independent directors to represent the government’s 40 per cent interest in the three DISCOs respectively during the transition.

“We are engaging with the Central Bank of Nigeria (as the banking sector regulator) to ensure an orderly transition and to ensure that Fidelity Bank does not hold the DISCOs’ shares in perpetuity.

“It is envisaged that the majority interest in the entities would be sold to capable private sector investors willing and able to re-capitalise and manage the entities efficiently.

“We have also received assurances that Fidelity Bank will participate fully in all the ongoing market initiatives aimed at improving the sector (National Mass Metering Programme).

“Also, with the takeover of Ibadan DISCO by AMCON, the BPE has obtained approval from NERC to appoint Kingsley Achife as the interim managing director.

“In a temporary capacity, the leadership of AMCON will be a placeholder board for the Ibadan franchise.

“Ahmed Kuru will chair the board, Eberechukwu Uneze and Aminu Ismail as members, while Oluwaseyi Akinwale will represent the interest of the government on the board alongside the director-general of BPE.

“Lastly, we are re-structuring the Management and Board of Port Harcourt DISCO to forestall the imminent insolvency of the entity.

“As a condition for support to the entity to meet its market obligations, Iboroma Akpana will take over as the Chairman of the Board. Emmanuel Okotete, Eyo Ekpo, Ismaila Shuaibu and the director-general of BPE will form the interim Board. 

It said Benson Uwheru would take over as the Managing Director of PHEDC as part of the changes.

According to the statement, the government will support the activation of emergency funds through the Nigerian Electricity Market Stabilisation Facility.

This according to the statement is to support the entity, while it goes through restructuring and repositioning to serve the citizens of the franchise area better.

“We are working with the Minister of Power to ensure no service disruptions during these transitions.

“We remain committed to supporting the Nigerian Electricity Supply Industry to serve Nigerians better,’’ it said.