Geregu Power Plc, the Lagos-listed power generation company acquired on Monday by Abuja-based Ma’am Energy from billionaire tycoon Femi Otedola, has appointed Abdul-Aziz Abubakar Yari, the senator representing Zamfara West, as chair of the company in breach of Nigeria’s code of conduct for public officers.
The utility named Mr Yari as his new chair to replace Mr Otedola in the wake of a board meeting where it was announced that the ownership of the company had changed hands, with the new majority shareholder now holding 77 per cent of the shareholding in beneficial ownership.
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A source conversant with negotiation talks put the value of the deal at $750 million.
In a letter notifying the Nigerian Exchange Limited of the change in the shareholding structure, Geregu Power noted that Ma’am Energy has bought 95 per cent equity interest in Amperion Power Distribution Company, making it the new controlling shareholder of the entity.
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Ma’am Energy was incorporated only less than three months ago, PREMIUM TIMES’ checks with the Corporate Affairs Commission shows and, according to a source familiar with negotiation talks, acquired the 77 per cent stake in Geregu Power for $750 million.
The 77 per cent is worth N2.2 trillion, using the market value of the company on Monday, the day the deal was made public.
When PREMIUM TIMES checked Ma’am Energy’s website on Monday, the information on it revealed that the company provides energy solutions, with services encompassing electricity generation and supply, oil & gas exploration and production, refining & processing and energy trading & marketing.
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But in yet another visit to the website on Tuesday morning, the website was inaccessible and the landing page contained the remark, “Sorry, we’re doing some work on the site.”
Apart from its website, Ma’am Energy does not immediately have an internet presence, checks by this medium shows.
Conflict of interest
Mr Yari won the Zamfara West senatorial seat on the platform of the ruling All Progressives Congress in 2019. Prior to that, he served as the governor of Zamfara State, North-west Nigeria, for two terms from 2011 to 2019.
By his appointment as chair of the company, the development raises critical concerns about the sanctity of Nigeria’s code of conduct for public officials.
Section 5 of Nigeria’s Code of Conduct states that “a public officer shall not put himself in a position where his personal interest conflicts with his duties and responsibilities.”
According to the Subsection B of the sixth section of the statutory document, “a public officer shall not except where he is not employed on full‐time basis, engage or participate in the management or running of any private business, profession or trade.”
The law only permits a public officer to engage in farming or participate in the management or running of any farm in addition to its duties.
Mr Yari’s phone was switched off when PREMIUM TIMES called Tuesday morning seeking comment, and couldn’t immediately respond to queries sent to him by text message.
“It’s a bit surprising. It is not expected that as a public officer you are holding such position. That’s a concern. There is a conflict of interest. He shouldn’t be able to hold that position” said David Adu, a deal advisory specialist at investment bank Meristem Capital Limited.
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“The regulators that are in the space need to have at least approved this transaction. For instance, I think before something like this happens the FCCPC needs to have approved, needs to have reviewed it. Because if they don’t have FCCPC approval, that transaction cannot take place.”
Mr Adu explained that if the transaction has been effected, it implies some regulatory authorities have looked at it and have okayed the deal. In that case, he added, those regulatory authorities need to be brought under scrutiny as regards how they did their evaluation.
“The NGX ultimately will still have to come to play in this and say that this company, by virtue of the new appointment that has been made, is it still abiding by the necessary code of conduct principles?”
In case the company is not abiding by the code of conduct, Mr Adu said, the NGX will have to make a request of the company to take all the necessary steps to comply with the rule.
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