After facing criticism for a move it lacked the authority to carry out, the Nigerian government attempted to backtrack on its previous statement on the dismissal of the management of the privately-owned on Wednesday.
Analysts charged the government for meddling in the country's electrical distribution industry, which it had handed up to private owners eight years earlier. Interference, they cautioned, risks driving away investors and aggravating the struggling industry's prospects.
The Minister of Power, Abubakar Aliyu, responded by saying that the decision to terminate the AEDC's management was made by the company's owners and was supported by the government as the regulator. On Tuesday, his ministry said President Muhammadu Buhari sought a new management team for the company, in which the government owns only 40% of the stock.
In a statement, his media aide, Ofem Uket, claimed that "the presidential directions as delivered also instructed the Bureau of Public Enterprises to form up a new management team of the AEDC."
"In a memorandum of understanding MOU jointly signed by the minister of state for power, Goddy Agba, the chairman of the Nigerian Electricity Regulatory Commission (NERC), Sanusi Garba, the director-general of the Bureau of Public Enterprises, Alex Okoli, and comrade Joe Ajaero on behalf of the union, the federal government ordered the suspension of the strike [and asked for] a 21-day period in which the outstanding emoluments and entitlements of
The comment alarmed industry players since such a decision could only be made by the firm's majority shareholders. Furthermore, no legislation authorizes the government to intervene in the business of private industrial enterprises.
"The president has no such powers," claimed Sam Amadi, a former head of the Nigerian Electricity Regulatory Commission, a regulatory agency. "Even though the federal government has a 40% minority stake in the assets, the Bureau of Public Enterprises, which has a seat on the board of directors, holds those shares for it." As a result, the most we can do is use our board position to influence policy changes.
"And the fact that the federal government has sovereign authority doesn't change the reality that regulation is the only method to defend public interest in the industry; any other move will look to be nationalizing back those assets."
AEDC is one of 11 power distribution firms formed when the industry was privatized in 2013. It is led by KANN, a group of investors that owns 60% of the company's stock. The AEDC, like most other distribution businesses, has struggled to improve electricity delivery to its customers since becoming live and has yet to break even.
The AEDC has also had internal issues as a result of a dispute over the company's ownership, which has had an impact on the company's operations.
Workers at the corporation shut down electrical facilities on Monday, resulting in blackouts across Abuja, Kogi, Nasarawa, Niger, and sections of Kaduna. They claimed that the corporation had been behind in paying their pension payments and other benefits for over two years.
Other corporate executives informed OUR SOURCE that, despite making such deductions from employees' wages, the company maintains it is not financially strong enough to pay them to pension authorities.
When contacted by OUR SOURCE on Tuesday, the company's spokeswoman, Oyebode Fadipe, declined to comment.
On Monday, the government stepped in to aid.
Mr Aliyu, the Minister of Power, said in a statement on Wednesday that UBA, the biggest shareholder at AEDC's lender, had taken over the company after a conflict over ownership had escalated.
"Due to a lack of access to assistance, the situation has worsened to the point where real employee rights are owed, resulting in service interruptions on December 6, 2021 across its franchise region." "Since then, the Federal Ministry of Power has taken the initiative to involve organized labor, and power service throughout the FCT and the states covered by AEDC has been restored," he stated.
Mr Aliyu claimed that when the bank exercised its rights over KANN Consortium's interests in AEDC, it also took over the shares of the obligor.
"AEDC's management has been alleged to have changed as a result of UBA's controlling interest in the company," he stated.
"The Nigerian Electricity Regulatory Commission (the industry regulator) and the Bureau of Public Enterprises ("BPE" as co-shareholders in AEDC) have supported the changes in shareholding in AEDC and the appointment of interim management for AEDC by the shareholders."
