The National Council on Privatisation (NCP) has begun ceding of the power firms to the new investors with the constitution of transitional committees for the 15 PHCN successors companies whose preferred bidders have paid the 25 percent bid value.
This development, which observers said will provide the new investors the opportunity to do an on-site due diligence on the power firms, is in compliance with the share sale purchase agreement (SSPA) approved by NCP. It will afford them the opportunities to have physical knowledge and details of the companies they are acquiring.
The transitional period will also help the investors to make up their mind whether they are going ahead with the acquisition or not.
The committees are 15 with each having three-members for each of the successor companies. Each committee has its membership drawn from the Bureau of Public Enterprises (BPE), the management of the successor company and the preferred bidder with the BPE nominee chairing it.
The 15 committees inaugurated on Wednesday by the chairman, Technical Committee of NCP, Atedo Peterside, could exist for a month or a maximum of six months depending on full payment. Transitional arrangements will allow a platform to ensure that both the companies and purchasers are ready for the handover process.
The acting director-general of the Bureau of Public Enterprises (BPE), Benjamin Ezra Dikki, explained that both BPE and the new owners have a mutual interest in ensuring the companies operate in a way so as to maintain the value of the company during the transition period.
He emphasised that the managements and boards of the successor companies will continue to exercise their functions during the transition period without interference from the transitional committees.
The terms of reference for the transition committees are to facilitate the smooth transition and eventual handover of the management and operational control of the successor companies to the purchasers.
The committee is also expected to allow purchasers access to the companies so as to prepare for the implementation of their business plans laid out in the proposals submitted to the BPE.
The committee is also expected to provide a forum for purchasers to engage with existing management and employees to ensure a smooth transition and handover; and also allow BPE and the purchasers to monitor the on-going operations of the company to ensure they are operating in an efficient manner and in compliance with the terms of the share sale agreements.
It would be recalled that share sale agreements were executed between the preferred bidders and BPE on February 21, 2013.
BADEJO ADEMUYIWA
