Chairman of Transcorp PLC, Mr. Tony Elumelu, on Wednesday revealed that the company’s market value has surged to $3 billion (N4.5 trillion), up from less than N20 billion in 2011 when the group took over ownership.
Elumelu, who made the disclosure at the company’s Annual General Meeting (AGM) held in Abuja, hailed the remarkable growth as a collective achievement of stakeholders, noting that the valuation does not yet reflect the potential of key subsidiaries such as TransAfam and the Abuja Electricity Distribution Company (AEDC), which are expected to further increase shareholder value once fully integrated and listed.
“Your company is growing. When TransAfam is listed, you can imagine what will be added to your current market value,” he said.
He also disclosed that Transcorp Power, one of the group’s flagship energy subsidiaries, now has a market value of over N2.7 trillion and has fully repaid the N250 million loan secured in 2014 for its acquisition.
On the group’s contributions to national development, Elumelu said Transcorp Power and TransAfam have a combined installed electricity generation capacity of 2,000 megawatts, with an available capacity of nearly 1,000 megawatts.
Elumelu described the achievement an impactful contribution in a country where less than 5,000 megawatts is generated on average.
“When we say that Transcorp is about transforming lives, improving lives and transforming Nigeria and Africa, it is based on the role we play in catalyzing development. Power is critical for the development of every economy,” he added.
However, the Transcorp boss decried the longstanding challenges in the Nigerian power sector, including liquidity constraints, poor infrastructure, and gas supply issues.
He lamented that the federal government currently owes the company over N600 billion for power generated and supplied to the national grid.
“I want to use this opportunity to reiterate that access to electricity, remains the single most critical factor in fixing the Nigerian economy, especially as we seek to have the non-oil sector make greater contributions to our economy. We must, therefore, fix power to fix and transform Nigeria.
“The dominant challenges of the power sector remain unresolved 20 years after some of them present heavy in this sector. As of date, our federal government owes your company over 600 billion naira. That is 400 million US dollars.
“Much as we, patriotic Nigerian investors, are committed to supporting the efforts of the federal government in fixing the economy, we have a rather excruciating burden of subsidizing the sector.
“It requires urgent attention. But I’m aware of some of the well-intended initiatives of the federal government in the power sector. The efforts commenced last year by the new administration, targeted at paying the debt owed to us, the Chairman stated”
Elumelu further acknowledged recent federal initiatives such as the Presidential Metering Initiative and reforms in transmission operations, but called for swift and decisive implementation to prevent the collapse of the sector.
He also announced the completion of a new 5,000-capacity event center at Transcorp Hilton Abuja, designed to position Nigeria as a hub for world-class international events.
“We believe that Nigeria should be able to attract global, international, world-class events. And you cannot achieve this without having an event center that can accommodate this number of people.
Published below are highlights of important issues raised by Transcorp chairman Tony Elumelu at the AGM meeting
• Transcorp Group today, the market value of your company’s listed entities is $3billion (N4.5trillion).
• When we took over the company in 2011, the market cap was less than N20 billion, we have grown value together.
• Your company indeed is growing. Last year, we took Transcorp Ughelli Power public and value today is in excess of N2.7 trillion.
• When we say Transcorp is about improving lives and transforming Nigeria and Africa, it is based on the role we play in catalysing development. Power is critical for the development of every economy.
• Transcorp Power Ughelli has the installed capacity of 1,000 MW of electricity generation and Transafam has 1,000 MW capacity. That is combined 2,000.
• But available capacity for the 2; Ughelli is 625 MW and Transafam 305 MW, combined its almost 1,000MW in a country where we consume less than 5,000MW you can now imagine what your company is contributing to the economy.
• Despite the challenging economic climate, one of our subsidiaries, Transcorp Power, has fully repaid the $215m loan it took in 2014 for the acquisition of Transcorp Power Ughelli.
• And at our Transcorp Hotel where you are sitting today, we have just completed the 5,000-capacity event centre.
• We believe Nigeria should be able to attract, global international, world-class events and you cannot achieve this if you do not have an event centre that can accommodate a huge number of people.
• Rwanda, Dubai and even Kenya have become hubs for events, so we want to put your country on that map, and we have succeeded in doing so and the Transcorp event centre is now open, and people are booking to use the facility.
• I want to use this opportunity to reiterate that access to electricity remains the single most critical factor in fixing the Nigerian economy especially as we seek to have the non-oil sector make greater contribution to our economy.
• We must therefore fix power to fix and transform Nigeria.
• The main dominant challenges of the power sector namely, liquidity infrastructure, gas availability remain unresolved 12 years after some of us invested heavily in this sector. As at date our federal government owes your company over N600 billion ($400 million).
• Much as we as patriotic Nigerian investors are committed to supporting the efforts of the Federal government in fixing the Nigerian economy we have been under excruciating burden of subsidising the sector as producers who do not get paid for the electricity we generate; we put on the grid and is consumed on the grid.
• This you will agree is totally not sustainable, it requires urgent attention.
• I am aware of some of the well-intended initiatives of the federal government in the power sector. The efforts commenced last year by the new administration, President Tinubu’s administration, targeted at paying the debt owed GENCOs.
• The presidential metering initiative targeted at increasing access to meters, the separation of the independent system operations from TNC to mention but a few.
• While the intentions behind these initiatives are very good, these intentions can only be achieved through ruthless, result oriented and timely execution of the initiatives before this sector collapses in front of our every eye with these attendant consequences.
• Let me therefore use this opportunity of our AGM to call on all those involved in executing our president’s directives on this initiative to please prioritise this critical national task immediately.
• They should expedite action to fully pay the huge debt owed GENCOs by completing the process already initiated towards the end of last year.
• The delivery of meters under PMI should be quickened, our group is more committed in working with the federal government on this.
• Transmission infrastructure whether under the PPI or other initiatives should be addressed immediately and special incentives should be put in place to expedite investment in gas and gas infrastructure development.
• I believe that the new leadership in NNPC will help to fast track this.
• The completion of the ongoing OB3 (Obiafu-Obrikom-Oben) gas pipeline will positively impact gas to power supply as the pipeline is expected to link the Eastern gas network where there is currently acute gas supply shortage; to the western network, with relatively better gas supply availability.
Cover pix: President/GCEO, Transnational Corporation(Transcorp) Plc, Owen Omogiafo and Group Chairman, Tony Elumelu at the 19th Annual General Meeting of the Company in Abuja on Wednesday
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