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Wednesday, August 28, 2013
The US-backed $7 billion Power Africa Initiative received a major shot in the arm with the announcement that full financing has been completed for the $300 million Ughelli power plant in Nigeria’s Delta state Nigeria by Transcorp Plc.
Transcorp plc is managed by Heirs Holdings.
In July Heirs Holdings committed $2.5 billion toward the Power Africa Initiative, a multi-stakeholder partnership between the US government and seven sub-Saharan African countries, including Nigeria; and earlier this year, Transcorp signed a cooperation agreement with General Electric (GE) for the development of the power sector in Nigeria.
Transcorp Ughelli Power Ltd. (TUPL) announced last week a $225 million payment to Nigeria’s BPE representing the 75% balance of the $300 million bid price for the 1,000 MW capacity plant. TUPL made an initial deposit of $75 million (25%) for the plant in February this year.
TUPL plans to increase the power generation of the plant from 300 MW to over 1,070 MW over the next five years.
United Bank for Africa Plc (UBA) and the Africa Finance Corp. (AFC) as co-arrangers, and First City Monument Bank Plc (FCMB) and Fidelity Bank as co-financiers provided the debt financing facility for the acquisition of the plant, which is one of the six power generation companies unbundled as part of the privatization of the Power Holding Co. of Nigeria (PHCN).
Commenting on the completion of their acquisition, Elumelu, the Chairman of Heirs Holdings and of Transcorp said: ‘It is a major stride forward and has significance for Nigeria, the region and Obama’s administration, as it represents positive progress in the fulfilment of Power Africa. We are committed to developing Nigeria’s power sector efficiently to meet the increasing demands of our fast-growing economy and improve the living standards of all Nigerians.”
The Power Africa Initiative led by the United States President, Barack Obama is a multi-stakeholder partnership between the US government and six (6) other sub-Saharan African countries, together with the African private sector. The shared objective of this initiative is accelerating investment in Africa’s power sector over the next five years.
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