Elumelu Finally Opens Up, Shares How Much FG Owes Transcorp Group for Electricity Supplied

• Nigerian billionaire and chairman of Transcorp Group, Tony Elumelu, has finally opened up on the amount the federal government owes
• He noted that despite efforts made by the government, the huge debt had become an unbearable burden for the group
• Elumelu shared with Transcorp shareholders the next moves the company will make to cement its growth and increase returns

Legit.ng journalist Ruth Okwumbu-Imafidon has over a decade of experience in business reporting across digital and mainstream media.

Chairman of Transcorp Group, Mr Tony Elumelu, has expressed concerns about the huge debts the federal government owes Transcorp as outstanding payment for electricity supplied to the national grid.

According to Elumelu, the government owes over N600 billion currently, giving the company a huge burden and impeding growth.

He said;

“As of date, our Federal Government owes your company over N600bn. That is $400 million. Much as we, patriotic Nigerian investors, are committed to supporting the efforts of the Federal Government in fixing the economy, we have a rather excruciating burden of subsidising the sector. It requires urgent attention.”

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Recall that Minister for Power, Adebayo Adelabu, disclosed that the federal government owed electricity distribution companies over N4 trillion.

Speaking at the Transcorp Annual General Meeting held in Abuja on Wednesday, Elumelu listed out efforts the government, led by President Bola Tinubu, has taken to address the challenges in the power sector, particularly the Presidential Metering Initiative and transmission reforms.

He called on the relevant players to accelerate the implementation and save the power sector from total collapse, adding that Nigeria cannot become a $1 trillion economy without addressing the recurrent electricity challenge.

“We must, therefore, fix power to fix and transform Nigeria. We know that to grow a $1tn economy, electricity must be fixed.”

Elumelu shares Transcorp growth plan to investors

Despite the challenges, Elumelu told shareholders that the Transcorp group had recorded massive growth since the takeover in 2011.

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Elumelu stated;

“When we took over this company in 2011, the market cap of Transcorp was actually N2 billion. Today, the group market cap is over N4.5 trillion.”

The group has also consistently paid dividends to shareholders since 2011, something which never happened before the takeover, the PUNCH reports.

Transcorp has also recently declared a N1 dividend per share for the 2024 financial year, and Transcorp Power market capitalisation is put at over N2.7 trillion, even after offsetting its $215 million FX acquisition loan.

Elumelu informed the shareholders of the completion of a 5,000 capacity event centre at Transcorp Hilton, to attract global events to Nigeria.

There are also considerations to expand into the renewable energy and agriculture sector, Elumelu said.

FG incurs additional N472 billion electricity debt

In related news, the federal government has incurred an additional N472 billion debt from electricity subsidies.

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This adds to the trillions of naira already owed to the DisCos, compounding what is an already dicey situation.

DisCos are also recording a 77% revenue collection efficiency with the customers, meaning that about 23% of electricity bills currently go uncollected.

Proofreading by James Ojo, copy editor at Legit.ng.

Source: Legit.ng