West Power and Gas Ltd (WPG), the parent company of Eko Electricity Distribution Company (Eko DisCo), is finalising plans to sell its entire stake in the electricity distribution firm.
The transaction, valued at over $200 million, is being facilitated by North-South Power, Axxela, and Stanbic Infrastructure Fund.
The consortium has already paid an initial 10% commitment fee, with the deal set to conclude in early 2025.
This acquisition combines the expertise of upstream and midstream companies expected to create one of the most integrated electricity distribution firms in the country.
North-South Power, the owner of Shiroro Dam, sees this as an opportunity to directly oversee Eko DisCo’s operations, which could address issues such as cash flow distribution.
For Axxela, a company doing great in Nigeria’s gas industry, the acquisition is strategic. The company aims to strengthen its presence in the distribution sector, which would allow it to gain direct access to revenue streams.
Similarly, Stanbic Infrastructure Fund views the investment as a means to align with its goals of generating sustainable cash flow for its investors while supporting Nigeria’s critical infrastructure.
Eko DisCo, known for its operational efficiency, has consistently met its remittance obligations in the Nigerian electricity market. In 2023, the company reported revenue collections of ₦177.5 billion with an energy billing of 3,448 GWh, achieving a collection efficiency of approximately 85%.
It also recorded an aggregate technical, commercial, and collection (ATC&C) loss of just 10.22%, one of the lowest in the industry.
The successful conclusion of this transaction could bring opportunities for recapitalisation and innovation in the country’s power market, thereby addressing long-standing challenges in the sector.
