FG lists conditions for assets sale

The Federal Government has given conditions that must be met before the sale of certain national assets.
Top among the conditions is that government will insert repurchasing clauses in the assets sale agreements.
A top government source who declined to be named disclosed this to Daily Sun.

The National Economic Council (NEC), chaired by Vice President Yemi Osinbajo, had, last Thursday, endorsed government’s plan to sell off some national assets as part of the solution to get Nigeria out of recession and revamp economic growth.

According to the source, government has also ruled out outright sale of assets.

“The federal government has no plan to sell-off its shares outrightly in the LNG where it owns 49 per cent shares and the balance 51 per cent owned by private foreign interests.

“Government doesn’t own the entire gas company and will certainly not sell-off its entire shares but is open to the possibility of selling its 49 per cent ownership by five per cent or thereabout.”

On the repurchase clause, the source said: “Just as in other potential asset sales, there would be a repurchase option that guarantees the federal government’s opportunity to buy-back any such assets if circumstances change anytime in the future.”

Though a list of national assets to be sold is yet to be drawn-up, the source said that there is also a clear decision not to sell any critical asset of the country.

“Some of the intended sales could be in form of time-bound leases, advance renewal payments on leasing licenses and concessioning which would attract buoyant signature fees. If we even want to sell certain assets, while our target is to get foreign currency, specifically dollars, the option would also be opened to Nigerians at some point to buy limited shares through the Nigeria Stock Exchange.”

The source disclosed that one of the concessioning deals almost completed is the East-West lines of the Nigeria Railways, with the General Electric (GE)-being the concessionaire. He also said the firm will invest $2 billion in the Nigerian economy including refurbishment of the single-gauge lane of the lines that have been left idle for years.

GE under the deal, the source added, is expected to hire back some of the laid off staff of Nigeria Railways and also open a Transport University in Nigeria while building/assembling train coaches in Nigeria.

Under the deal, the Federal Government would also receive a signature fees in foreign currency as it would in other assets that might be concessioned.