The Federal Government has extended the deadline for Televeras Group and Northwest Power Plc; the preferred bidders for Afam Power Plc and Kaduna Electricity Distribution Company, respectively, to pay the balance of 75 percent of purchase prices to October 6, 2014.
Their original deadline expired on August 6, 2014
The Bureau of Public Enterprises said in Abuja, yesterday, that the Televeras Group pleaded the non-execution of the gas agreements required to bring the transaction to a financial conclusion and security challenges, as reasons for seeking the extension.
“It would be recalled that the Televeras Group-preferred bidder for Afam Power Limited had on May 19, 2014 requested from the Federal Government an extension of time to pay the balance of the 75 percent bid price for the power Company because gas agreement that is germane to the completion under the Share Purchase Agreement, SPA it signed with the government had not been executed”, the bureau explained.
Televeras claimed that the bankability of the transaction was predicated on the execution of the gas agreement and that the non-execution of the agreement had made it difficult to satisfy the due diligence enquiry required for the raising of funds to make the full payment.
The investors had paid the initial deposit of 25 percent of the bid price of $ 65,012,500 for the Afam Power Plant.
On its part, Northwest Power Ltd had on July 25, 2014, requested an extension of transaction timeline by 60 days due to the recent security challenges experienced within the Kaduna Electricity Distribution Company, which made its offshore financiers to postpone disbursement of bank facilities already obtained.
The company explained that though it had secured financing for the transaction from a foreign bank, the bank had requested for additional time to review the transaction in the aftermath of the security challenges in Kaduna to ensure the safety of its funds.
Northwest paid $40,750,000 for the Kaduna Electricity Distribution Company following which the Share Purchase Agreements,SPA, was with the BPE with a requirement to pay the outstanding balance of 75 percent of the bid price within six months of the execution of the SPA on August 6, 2014.
