Cash Crunch: Nigerian govt mulls sale of stakes in NNPC, others to raise funds
The reality of the state of the Nigerian economy may have dawned on the Federal Government as reports have it that it is mulling selling stakes in about 20 state run companies.
The move, according to a report by Bloomberg, is to raise funds and improve corporate governance in the companies.
According to the Chief Executive Officer of Finance Ministry Incorporated, an agency of the Federal Ministry of Finance, Budget and National Planning, Armstrong Takang, the entities include Nigerian National Petroleum Corporation Limited (NNPCL).
Takang noted that the agency was considering options including strategic sales and initial public offerings and aims to implement the plan within 18 months.
According to him, some of the entities need the private sector to take controlling shares and the major consideration for the government is to create value rather than retain control.
“It is better for us to own 49 per cent of a high-performing entity than 90% of an entity that is underperforming’, Takang said
Takang further stated that the agency is in the process of appointing consultants including valuers, financial advisers, lawyers, bankers, and others to handle different aspects of the transactions.
The plan for the sale of government stake in the companies may be in line with President Bola Tinubu’s plan to reform the country’s economy.
The Ministry of Finance, Budget and National Planning had said in October 2022, that the government was considering selling or concessioning about 27 national assets.
These assets included Tafawa Balewa Square in Lagos, the National Integrated Power Projects in Olorunsogo, Calabar II, Benin (located at Ihorbor), Omotosho II, Geregu II plants, all the hydropower plants across the country, including Oyan, Lower Usuma, Katsina-Ala, and Giri plants
