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BPE Shortlists 15 Indian Companies to Participate in PHCN Privatization

By on January 26, 2012

According to the Economic Times of India, 15 Indian firms have been shortlisted by the Bureau of Public Enterprises (BPE) to purchase the successor companies of the Power Holding Company of Nigeria (PHCN).

The successor companies will cut across power generation and distribution companies and the companies shortlisted to acquire them include the usual suspects of who is who in Indian industry including, Tata Power, GMR Group, and Adani Power.

Struggling on home ground with multiple issues which have delayed capacity addition, Indian power companies are exploring participation in power generation and distribution projects in Nigeria to fuel their growth despite the civil unrest in the country.
Nigeria is in the process of selling a 51% stake in four thermal and two hydro power generation units and 11 transmission projects since PHCN’s poor operational and financial performance has deterred capacity addition in the country.

According to Arun Sen, CEO of Lanco International, an arm of Lanco Infratech, “Nigeria is a part of our geographical expansion plan. It has gas reserves and the energy requirement of a population of 15 crore people is a big incentive.”

He added, “”They have a need and we have the technical, commercial and operational capability.”

Indian companies are considering Nigeria as a “natural hedge against local slowdown”, but the entry into the country would not be easy, given its political and social condition. Some of these Indian companies are already jittery about going ahead in the bidding process as Nigeria struggles with widespread religious violence, labour unrest, crumbling infrastructure and high incidence of corruption.


“The country risk for Nigeria is not encouraging,” said A Subba Rao, CFO, GMR Group. “As a strategy, we will not be bidding for projects overseas, except for airport projects. We participated in the process in Nigeria with a perspective to learn more about the international market, but we don’t plan to go ahead with bidding,” he said.

Sector experts said that Indian companies which have a presence in Africa, particularly in Nigeria, would be well placed to participate in the bids for these projects. Also, the energy security that the country can provide may lure companies to bid actively for these projects.

“We have an offshore oil and gas block in Nigeria. We would like to leverage on our presence in the country and take up power projects there,” a spokesperson from Essar Energy said.

Skipper Electricals (India), which is among shortlisted candidates for the privatisation project, believes that the unrest may be short-lived. “These disturbances don’t deter our plans. The problems would be over. So, we don’t feel the need to give up on the opportunity,” said Skipper’s chief executive officer Rakesh Sardana.

3 Comments

  1. Anonymous

    January 26, 2012 at 12:50 pm

    INDIANS SHOULD BE BEGGING NIGERIA FOR LITTLE  JOBS .

    THERE IS HARDLY A DAY IN INDIA PEOPLE DONT GET KILLED .
    i have been to indian and i know them very well.

    KASMIRE AND OTHER VOLATILE AREAS

  2. Anonymous

    May 12, 2012 at 8:46 am

    Indians too can comment on violence and corruption in Nigeria. Eheheheheh.. I laugh.  Wonders shall never end.

  3. Anonymous

    May 12, 2012 at 8:46 am

    Indians too can comment on violence and corruption in Nigeria. Eheheheheh.. I laugh.  Wonders shall never end.