MOFI: Takeover of FG’s 40% Shares in Discos, Essential Element of Our Consolidation

Ndubuisi Francis in Abuja

The Ministry of Finance Incorporated (MOFI) has stated that the  resumption of its rights of management of the federal government’’s 40 per cent shareholding in the 11 electricity distribution companies (Discos) and the various equity stakes in related energy sector companies was an essential element of consolidation.

In a statement issued yesterday,  signed by its Managing Director,  Dr. Armstrong Takang, MOFi which is the holder and manager of federal government’s investments, said the take over of the stakes would drive operating efficiency, best corporate governance practices and ultimately maximise the

value derived from the electricity assets, in alignment with President Bola Tinubu’s economic growth agenda.

The Minister of Finance and Coordinating of the Economy, Mr. Wale Edun, had at the weekend, in a letter dated January 10, 2024 directed the Board of Directors of MOFI to immediately revoke the Power of Attorney (PoA) which the Bureau of Public Enterprises (BPE) exercised on its behalf in the past over one decade in the electricity successor companies.

The minister also directed MOFI to immediately assume ownership, control and management of all equity holding of the Federal Government of Nigeria in the  successor companies of the Power Holding Company of Nigeria, assume ownership, control and management of all equity holding of the Federal Government of Nigeria as contemplated and provided for by law and/or any contract; and issue all appropriate notices, instruments, documents which are required to give effect to this directive.

In its latest statement,  MOFI, which has already executed the ministerial directive, said it had in 2012, issued a Power of Attorney to the Bureau of Public Enterprises (BPE) whereby BPE was empowered to carry out the actions necessary to fulfil the National Council on Privatisation (NCP’s) directives and complete the various electricity privatisation (share sale) transactions.

The BPE, it added, had since then held shares in the Discos on behalf of MOFI, adding that this continued for over 10 years after the sales were completed in 2013, until the recent order by the Minister of Finance.

While extending  its gratitude to the BPE for its stewardship of the shares, the company noted that, “as a reformed  and active entity, MOFI is taking significant steps to ensure that these assets deliver full value to the country.”

“We look forward to collaborating with our key stakeholders and, through our concerted efforts, making a tangible impact in contributing to a thriving, resilient and growing Nigeria,” the statement added.

According to MOFI, in the past 24 months, and particularly since the amendment of the MOFI Act by the Finance Act, 2023, it has been reformed and restructured from a unit in the Office of the Accountant-General to a full-fledged public sector (FGN) asset management corporation.

“This arose from the recognition that FGN assets across practically all economic sectors nominally valued at very significant sums were largely moribund or grossly underutilised and poorly managed. “Consequently, it was determined in 2021 by the then Minister of Finance, amongst other relevant decisions, that MOFI would adopt a new, value-driven strategic direction in aggregating and managing FGN assets,” the statement explained.