BPE Names Interim Mgt. Team For AEDC

The Bureau of Public Enterprises (BPE) has named members of the interim management team for the Abuja Electricity Distribution Company (AEDC) Plc.

They are:

  1. Bada Akinwumi- Interim Managing Director
  2. Sani Usman- Interim Chief Business Officer
  3. Babajide Ibironke- Interim Chief Finance Officer
  4. Donald Etim- Interim Chief Marketing Officer; and
  5. Femi Zachaeus- Interim Chief Technical Officer.

Already, the Nigerian Electricity Regulatory Commission (NERC), the regulator in the power sector has approved the appointment of the interim management team for the power company.

Chairman of NERC, Sanusi Garba in approving the appointment of the new interim management for the AEDC said it is “pursuant to the earlier fit and proper review of your (BPE’s) pool of nominees and in the context  of Business continuity  frame work of the Nigerian Electricity Supply Industry (NESI)”.

It would be recalled that the Nigerian Electricity Regulatory Commission (NERC) and Bureau of Public Enterprises (BPE) had sacked the former management team of the AEDC and approved the appointment of   an interim team to manage  the power  distribution company   on the basis of legal  processes  arising  from the failure   of the core investor  to meet its obligations   to a lender.

NERC and BPE in a joint statement on Wednesday, signed by Sanusi Garba and Alex Okoh, Chairman and Director General respectively, stated that there has been an ongoing dispute amongst competing factions of AEDC’s majority shareholder/core investor i.e. KANN Utility Company Limited (KANN); and the dispute eventually spilled over with the lender that provided the acquisition loan to KANN for the acquisition of  majority shares  during the  privatisation exercise  in  2013,  over KANN’s inability to service its debt to the bank.

The United Bank for Africa (UBA) had acted as Mandated Lead Arranger, underwriting the entire facility of $122million, about N20 billion then for Kann Utilities acquisition of the Abuja Electricity Distribution Company.

“During the course of the intractable crisis, AEDC not only struggled to meet its obligations to the market under the terms and conditions of its licence but was also unable to meet its obligations to key stakeholders in the organisation including staff culminating in the industrial action by members of the Nigerian Union of Electricity Employees (NUEE). Eventually, this resulted in a total service disruption on 6th December 2021 for over 14 hours in AEDC’s network area. The provision of electricity supply in AEDC’s network area was only restored after the intervention of the Minister of Power, NERC and BPE following an agreement with the union on the terms for the suspension of the industrial action on 6th of December 2021.

“The public should note that arising from KANN’s inability to service its acquisition loan and the ensuing dispute over the servicing of the loan from U BA Pie, the lender exercised its rights by appointing a Receiver/Manager over KANN. Stakeholders including NERC, Central Bank of Nigeria (CBN) and BPE had on several times worked to broker an amicable resolution between the contending parties. The protracted resolution of the dispute exacerbated the state of affairs at AEDC resulting in an industrial action and a total blackout in the service area for over 14 hours.

“It then became apparent that decisive steps were required to address the matter and BPE agreed with the lender’s request to exercise its powers as Receiver/Manager    over KANN by exercising   its powers over the 60% equity in AEDC as a means to recovering the acquisition loan granted by the Bank.

“The action   to appoint   an interim team to manage AEDC was not done on the basis of a directive   from the Federal Government as being falsely   reported in the press but on the basis of legal processes arising from the failure   of the core investor in AEDC to meet its obligations   to a lender. “The   Receiver/Manager    has agreed   to the   appointment    of an interim management   team in conjunction   with BPE as  part  of  measures   designed   to address   business   failure   events   and  ensure  continuity   of  service  to  end-use customers  in  the service  area.

 

Amina Tukur Othman

Head, Public Communications

December 9, 2021.