By Linus Aleke, Abuja
The Nigerian Electricity Regulatory Commission (NERC), has dissolved the board of directors of Kaduna Electricity Distribution Company (KAEDC), over non-performance and lack of capacity to pay the N110bn debt it owes the Nigerian Electricity Supply Industry (NESI).
This is contained in the Commission’s latest order, following KAEDC’s inability to live up to its financial obligations as contained in its acquisition agreement.
The order, which is jointly signed by the Commission’s Chairman, Engr Sanusi Garba, and Vice Chairman, Dr Musiliu Olalekan Oseni, explained that the company was unable to get a new buyer on time, hence the new order.
The order revealed that the company was owing the Nigerian Bulk Electricity Trade (NBET) and TCN’s Market Operator (MO), no fewer than N110bn, since 2015.
It also explained 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.
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The order added that the bank requested 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.
The order noted that the failure of the company to get a new owner to enable it to meet up with its financial obligations, compelled it to disclose the entire board of directors of KAEDC.
It, therefore, noted that section 75 of the Electricity Act (EA), empowers the commission to exercise the aforesaid powers.
To this end, the order equally stated that Dr Umar Abubakar Hashidu is appointed the administrator of KAEDC in furtherance to section 75 of the EA.
The Commission said: “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 A. Okoh, Chairman, Kabir Adamu, Sharfuddeen Zubair Mahmoud, John Ayodele and Rahila Thomas”.
It also noted that the executive management team that shall work with the administrator would be constituted by the commission and announced in due course.
Recall that the KAEDC is among five 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 privatization in 2013.
It was also reported that the Managing Director of the company, Yusuf Yahaya, announced his resignation from the company last week Saturday.
