Tuesday, November 29, 2022
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No basis for takeover of Benin Electric -management

.Assures customers, stakeholders of continuing operations

The management of Benin Electricity Distribution Company (BEDC) Plc, has said that there is no legal basis for the takeover of the company following the purported activation of the call on its collateralised shares by Fidelity Bank.

The purported activation seeks to take over the respective Boards of Kano Electricity Distribution Company, Kaduna Electricity Distribution Company and BEDC Electricity Plc (the DisCos) over the inability to repay the loans obtained to acquire majority stakes in the DisCos in furtherance of the 2013 privatisation exercise.

Nigerian Electricity Regulatory Commission (NERC) and Bureau of Public Enterprises (BPE), in a statement on Tuesday, have considered the three firms to be technically incapacitated, and financial insolvent after their loan facilities from Fidelity Bank became moribund, landing them in trouble with the Bank.

The management and board were subsequently removed and announced their replacements.

But BEDC company in a statement on Wednesday said: “The referenced report also alleges that certain parties have been appointed as Board Members, Independent Directors and Managing Directorof BEDC Electricity Plc. We understand these appointments have been communicated to the Bureau of Public Enterprises (BPE) and the Nigerian Electricity Regulatory Commission.”

However, the management of BEDC stated unequivocally that, “There is no contractual, statutory or regulatory basis for such.” The statement added that, “For the avoidance of doubt, the shares of BEDC have not been given as security to Fidelity Bank or to any other party.”

According to the statement, “As we understand it, Vigeo Holdings Limited (VHL – a non-shareholder of BEDC) obtained credit facilities from Stanbic IBTC Bank Limited, Fidelity Bank Plc, and Keystone Bank Plc (the VHL Lenders). 

“We further understand that the said credit facilities (and any enforcement action in relation thereto) have in the meantime become subject of litigation in a Court action instituted by VHL and other plaintiffs (the VHL Action) with Suit No: FHC/L/CS/239/22 – Vigeo Holdings Limited and 4 Ors v. Stanbic IBTC Bank Limited, and therefore, subjudiced.”

The management of BEDC Electricity Plc warned that, “Any attempt by Fidelity Bank and/or BPE to intervene in BEDC in the manner being reported will be illegal, unlawful and will be resisted.”

Consequently, the company urged its customers, investors and partners in the electricity business to ignore the trending reports while assuring them of continuing smooth operation and that it remains, “Focused on its mission to ensure delivery of quality and reliable electricity to the good people of Edo, Delta, Ondo and Ekiti States.”

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