Sapele Genco Bidder Gets Three Months Extension To Pay

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Akin Akande, Abuja

The National Council on Privatisation (NCP) on Thursday gave a three-month extension to the preffered bidder for Sapele Generation Company (GENCO), EurAfric.

EurAfric bidded $201 million for the company but could only offer 180 million dollars at the expiration of the deadline.

Minister of State for Industry, Trade and Investments, Dr. Samuel Ortom, disclosed the extension during a press briefing at the State House, Abuja after a meeting of the NCP Board chaired by Vice President Namadi Sambo.

Ortom said the NCP granted the extension in line with the provisions of the bid agreement and after receiving legal advice from the Council’s Legal Committee and the Office of the Minister of Justice and Attorney-General of the Federation.

EuroAfric emerged the preferred bidder during the bid process, which left Nestle/Julius Berger as the reserve bidder with an offer of $106 million.

The Council rose from its 7th meeting this year to grant EurAfric the extension, stating that it was better to hold on to the $180 million at hand than go with the 106 million dollars being offered by the reserved bidder, Nestle/Julius Berger.

Shedding more light on why the Council took that decision, chairman of NCP’s Legal Committee, Yunus Ustaz Usman, noted that the extension was in order as the relevant clause in the sale agreement clearly provided for such an extension.

He said the NCP was, therefore, not in breach of the bid process and was not afraid of any litigation that could arise.

Usman stressed that the Council learnt a hard lesson about the extension of payment deadlines from the ALSCON privatisation case which is still pending at the Supreme Court.

According to him, it made better economic sense to wait a little for the preferred bidder who had paid as much as  $180 million than “turn back the hand of the clock” by starting afresh a sale agreement with a bidder that had offered a much lower price of $106 million for the power plant.

Usman said: “Our legal standpoint is that since we have the right to extend at any time and since the highest bidder has paid about $180 million, it is safer and in the interest of the public to so extend.

“The Vice President graciously said since these monies are meant for Nigerians, you cannot take $106 million that has not been paid and say you are foregoing $180 million dollars. The NCP graciously agreed and that is the position where we are.

“In the case of ALSCON, the case is still at the Supreme Court and we tried by all means to ensure that we don’t fall into that trap again,” he explained.

He also declared that everybody had a right to go to court but that ‘winning is a different thing’, insisting that the NCP had taken care of any loopholes that could be exploited for litigation.

Also, during the NCP meeting, the Vice President inaugurated the Board of the Nigeria Electricity Liability Company (NELCO) under the chairmanship of Minister of Finance and Coordinating Minister of the Economy, Ngozi Okonjo-Iweala.