Kano Disco shareholders petition BPE, bank over N670m infraction

More troubles seem to be brewing for the management of Kano Electricity Distri­bution Company (KEDC) on a recent query from the Nigerian Electricity Regula­tory Commission (NERC) over the N670 million unap­proved payment as share­holders represented on its board by INCAR Power Limited has petitioned the Bureau of Public Enterprises (BPE) and Fidelity Bank over what it termed ‘illegal transaction’.

According to a letter ex­clusively obtained by Daily Sun, dated October 2, 2014, addressed to the Managing Di­rector/Chief Executive Officer (CEO) of KEDC and signed by the Chairman of INCAR Power Limited, the major­ity shareholder in KEDC, Dr. Umaru Mutallab, the petition­er stated that it was alarmed to peruse the contents, especially article (1) therein, in which a staggering amount of N670 million was surreptitiously withdrawn from the reserves of the consortium-managed KEDC and paid into a private account with Fidelity Bank.

The letter was also copied to BPE, Fidelity Bank and Sahe­lian Energy.

Recall that Daily Sun had last week, exclusively reported the query served to KEDC by NERC over the N1.1 billion unapproved spending under various sub-heads within six months.

In the query addressed to the MD/CEO of KEDC, dated September 25, 2014, with reference number NERC/07/ LLE/14/LAS/620, NERC demanded explanations in writing for the payment of N670,000,000 million, which was made on February 5, 2014, from KEDC central col­lection account to Northwest Power (the preferred bidder for Kaduna Disco).. Sahelian Energy as a consortium also has a stake in Northwest Pow­er while INCAR is a major shareholder in the consortium, hence its interest in why funds realized from KEDC should be used to fund the acquisition of Kaduna Disco.

Kaduna Disco and Afam Genco are the remaining two successor companies out of 17 carved out of the defunct Pow­er Holding Company of Ni­geria (PHCN) whose sale had suffered deferments owing to technical hitches as none of the previous bidders met the tech­nical requirement of the priva­tization regulating agency.

The letter from INCAR to KEDC read in part ‘‘We wish to bring to your notice that, as a major shareholder and board member of KEDC, we are completely in the dark as to this transaction because due process was not adhered to. Our company thrives on integ­rity and aims to implement the highest Corporate Governance Standards at all times.

Source : SunOnline

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