- Appoints administrator to manage utility
From Isaac Anumihe, Abuja
The Nigerian Electricity Regulatory Commission (NERC), yesterday, dissolved the board of directors of Kaduna Electricity Distribution Company (KAEDC) for its inability to pay N110 billion debt owed the Nigerian Electricity Supply Industry (NESI).
In its order dated January 1, 2024 and jointly signed by its Chairman, Sanusi Garba and Vice Chairman, Musiliu Oseni, NERC said the order was also due to the receivership of the company not being able to get a new buyer of the company on time.
Recall that KAEDC is among the five electricity distribution companies (DisCos) that were taken over by their funders after the core investors were unable to pay back the borrowed funds used to acquire the company during privatisation in 2013.
To this effect, the Managing Director of the company, Yusuf Yahaya, announced his resignation from the company last Saturday.
According to the document announcing the dissolution, NERC stated that the company was owing N110 billion to the Nigerian Bulk Electricity Trading (NBET) and Transmission Company of Nigeria (TCN’s) Market Operator (MO) since 2015 till date.
The order stated that the receivership, headed by Afrexim Bank, had been given 60 days notice to state why its licence should not be cancelled with another 30 days given in July last year.
It stated that the bank requested for four to six months to finalise the divestment process and that they could not provide the bank guarantees required to secure KAEDC’s market obligation.
Consequently, the order stated that the failure of the company to get new owners to enable it meet up with its financial obligations would cause the directors their job.
So, “all directors of KAEDC are hereby removed from office and the board of directors stands dissolved in the exercise of powers vested in the commission by Section 75 of the Electricity Act (EA)” NERC, said.
To this effect, Dr. Umar Abubakar Hashidu is hereby appointed as the administrator of KAEDC in furtherance to section 75 of the EA.
“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 Okoh, Chairman; Kabir Adamu, Sharfuddeen Zubair Mahmoud, John Ayodele and Rahila Thomas,
Meanwhile, 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,” the commission noted.