The Nigerian government is considering selling stakes in approximately 20 state-owned companies as part of an effort to raise funds and enhance governance within these entities.
As reported by Bloomberg, one of the firms that the government is contemplating divesting from is the Nigerian National Petroleum Corporation (NNPC). Armstrong Takang, the CEO of the Ministry of Finance Incorporated, revealed that the government is exploring various options, including strategic sales and initial public offerings (IPOs), with the intention of executing this plan within the next 18 months.
Takang emphasized that certain entities would benefit from private sector involvement to assume controlling shares. The government’s primary focus is to generate value rather than maintaining control.
He stated, “We would rather own 49 percent of a well-performing entity than 90 percent of an entity that is underperforming.”
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These potential sales could align with President Bola Tinubu’s vision to revamp the country’s economy. Takang confirmed that the agency is currently in the process of appointing consultants to handle various aspects of the transactions, including valuation, financial advice, legal matters, and banking services.
In October 2022, sources within the Ministry of Finance, Budget, and National Planning exclusively informed The PUNCH newspaper that the government was contemplating the sale or concession of approximately 27 national assets.
Among these assets were the Tafawa Balewa Square in Lagos, the National Integrated Power Projects in Olorunsogo, Calabar II, Benin (located at Ihorbor), Omotosho II, Geregu II plants, as well as all the hydropower plants across the country, such as Oyan, Lower Usuma, Katsina-Ala, and Giri plants.
These sources indicated that over 25 of these projects would be transformed into active revenue-generating assets for the federal government.
The notion of selling national assets to bolster government revenue has been under consideration since 2016.