Axxela Limited, Stanbic IBTC to acquire 60% stake in Eko DisCo

Transgrid Enerco Limited, an energy firm formed by an alliance of North South Power Company Limited (NSP), Axxela Limited, and the Stanbic IBTC Infrastructure Growth Fund (SIIF), has signed a share purchase agreement for the proposed acquisition of a 60% equity stake in Eko Electricity Distribution Company (Eko DisCO).

Eko DisCO is Nigeria’s second-largest electricity distribution company.

The agreement was signed on Tuesday, with the transaction expected to be completed in April 2025.

There had been reports earlier this month that West Power and Gas Ltd (WPG), the parent company of Eko DisCo, was close to selling its entire stake after the North-South Power, Axxela, and Stanbic Infrastructure Fund consortium won the bid to acquire it.

It was stated that the bid to acquire Eko Disco started a year ago. While the amount in the deal was not stated, it is believed to be in excess of $200 million according to this news report.

NSP which owns Shiroro Dam will get direct control and insight into Eko DisCo’s operations enabling it to have a clear scope of the company’s cash flow distribution.

While Eko Disco meets remittance obligations to the market, the inability of other DisCos to meet these obligations means that power-generating companies like NSP do not get their full payments.

This acquisition allows NSP to have better control of how the company collects payment and perhaps influence other DisCos to employ more efficient payment collection tactics.