West Power and Gas Limited Moves Toward Significant Stake Sale in Eko Electricity Distribution Company
In a major development for Nigeria’s electricity sector, West Power and Gas Limited (WPG), the parent company of Eko Electricity Distribution Company (EKEDC), is on the verge of selling its entire stake in EKEDC. This move represents a pivotal moment not just for WPG, but also for the future of energy distribution in Nigeria.
According to a recent report from Africazine, a consortium led by North-South Power (NSP)—the operators of the Shiroro Dam—has successfully placed a commitment fee, effectively initiating their bid to acquire a majority stake in Eko DisCo. Stanbic Infrastructure Fund and Axxela, a player in the oil and gas sector, are also key members of this consortium, highlighting a collaborative approach among diverse energy stakeholders.
The competitive bidding process commenced earlier in 2024 and has attracted significant attention, given the potential ramifications for Nigeria’s power landscape. As the consortium enters the conditions precedent phase, they are tasked with fulfilling specific requirements before the agreement can be officially concluded. This meticulous approach ensures that both the buyers and the sellers are poised for a seamless transition.
An insider familiar with the arrangements noted that NSP stands to gain considerably from this acquisition. Owning a substantial stake in Eko DisCo will provide the company with direct oversight of its operations, which in turn could lead to enhanced cash flow. This strategic shift aligns with the evolving landscape of Nigeria’s power sector, where bilateral contracts between generation and distribution companies are becoming more prevalent, creating new opportunities for energy producers.
The report further emphasizes that experiences from other major players reveal a trend: for instance, Transcorp Power, which owns the Ughelli Power Plant, holds a significant share in Abuja DisCo, while Sahara Power, with its investment in Egbin Power Plant, has a majority stake in Ikeja Electric. These examples illustrate a growing consolidation in Nigeria’s electricity market, aimed at driving efficiency and improving service delivery.
As anticipation builds, the impending deal is projected to close in early 2025, with its size estimated to surpass 0 million. The final purchase agreement will be finalized once all necessary conditions have been met. This progression underscores a dynamic shift in Nigeria’s energy sector that not only aims to improve electricity distribution but also signifies the robust interest from private investments in essential services.
Stay tuned as this story develops, promising to reshape the electricity distribution landscape in Nigeria in the coming years.
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