No Way: Court Orders NERC, BPE Not to Sell Kano DisCo to Powercom

• A Federal High Court in Lagos has ordered any activity involving the sale of Kano Disco to be halted
• The applicant, Future Energies, claimed that the selection process for top candidates was erroneous
• Future Energies said it had earlier signed a deal for the acquisition of the DisCo, but Fidelity Bank suspended the process for a new bidder

Justice Nicholas Oweibo of the Federal High Court in Lagos has prohibited the Nigerian Electricity Regulatory Commission (NERC), the Bureau of Public Enterprises, and Sahelian Power SPV Limited from appointing Powercom or any other investor as a new core shareholder in Kano Electricity Distribution Company.

Additionally, the respondents were forbidden by Justice Oweibo from holding or recognising any other bidding procedures for selling Sahelian's 60% stake in the Kano Electricity Distribution Company.

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This is coming after an earlier report by Legit.ng that two companies, Powercom and Future Energies, are battling over Kano Electricity Distribution Company.

Fidelity Bank, the receiver manager, Kano Electricity Distribution Company Plc, Patrick Ikwueto SAN, and Powercom Smart Grid Nigeria Limited were affected by the orders.

FEA claims the procedure was erroneous

Future Energies Africa (FEA) Limited, the petitioner, had informed the court that the procedure used to select Powercom Smart Grid Nigeria (PSGN) as the top candidate to replace Kano Electricity Distribution Plc (KEDCO) was erroneous, according to a Leadership report.

Additionally, the applicant, FEA, claimed NERC and Powercom did not adhere to the rules and specifications established by the Bureau of Public Enterprises (BPE) and NERC.

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The government's 40% ownership stake in the asset used for energy distribution is being held by BPE, while Fidelity Bank is the interim owner of the other 60%.

Fidelity Bank started a bidding procedure through a receiver manager, working with the BPE, to find a performing buying user who was technically sound and financially capable of purchasing the bank's stake in KEDCO. In a recent statement, Powercom just announced its acquisition of KEDCO.

By pointing out that Powercom cannot claim to have acquired KEDCO when FEA Future Energies had already finished the execution of contracts and agreements through a Share Sale and Purchase Agreement to acquire the shares that both BPE and NERC are aware of, engineer Adam Ibrahim (an investor and consortium member of FEA) criticised the premise of the acquisition announcement.

Because FEA's complaints to BPE and NERC were ignored, Engr Ibrahim claimed that the organisation had no choice but to initiate a lawsuit.

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Powercom, Future Energies Africa battle over Kano Electricity Distribution Company

He said the Nigerian Electricity Regulatory Commission (NERC) issued a "No Objection" for Powercom despite the pending complaint, its knowledge of a signed Share Sale and Purchase Agreement and agreed transaction terms as forwarded to them by BPE and Fidelity's representative, and a subsequent complaint by Future Energies regarding Fidelity Bank's attempt to thwart the completed process.

After competing against other bidders in a thorough assessment and screening process that lasted nearly a year, Future Energies Africa was awarded the earlier contract. It received a "No Objection" approval from the BPE for meeting the acquisition conditions outlined in the BPE and NERC rules.

But according to FEA, despite having previously signed a legal and binding contract to sell the shares to Future Energies Africa, Fidelity Bank, the temporary owner of a 60% part of the company, opted to suspend the process and accept a different bidder for an unspecified reason.

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Association condemns DISCO's exorbitant electricity bills

In related news, Legit.ng earlier reported that Ganiu Makanjuola, President of the National Association of Electricity Consumers of Nigeria (NAECN), reacted to the rate distribution companies issue consumers outrageous electricity bills.

Makanjuola, a NAN reporter in Lagos, claimed that the distribution businesses were dishing out invoices without providing equivalent services.

Source: Legit.ng