Nigerian multimillionaire businessman Tony Elumelu has confirmed plans to spin off Transcorp Power, the energy arm of Transnational Corporation of Nigeria Plc, in five years, debunking rumors that the conglomerate planned to list the power business on the Nigerian Exchange.
Elumelu, Transcorp’s chairman, made this disclosure during an interview in which he discussed the potential spin-off of Transcorp Power Plc as a result of a board resolution passed at the conclusion of the company’s Annual General Meeting (AGM).
The potential spin-off of Transcorp Power, comes more than eight years after the conglomerate spun off Transcorp Hotels as a separate entity from the group through an initial public offering in 2015.
During a recent interview about the firm’s future plans, Elumelu denied rumors that he planned to list Transcorp Power as a separate institution on the exchange, stating that the conglomerate was in it for the long haul.
“No, we are not currently listing; I hear that rumor from time to time, especially after some competing institutions were listed on the exchange. No, we are long-term players, we want to grow more and significant value in the power sector,” he said.
“We are looking at about five years from now to list Transcorp Power because we believe the transmission lines would have been fixed and the gas supply to the power sector would have improved significantly,” Elumelu added, confirming that a spin-off was in the works.
His statement will help to answer some questions raised by analysts and investors after one of his companies, HH Capital Limited, started buying billions of shares in Transcorp following the acquisition of a significant 5.52-percent stake by Nigerian billionaire Femi Otedola.
Otedola has increased his ownership interest in the diversified conglomerate beyond 6.3 percent after purchasing a 5.52-percent stake in Transcorp nearly two weeks ago, equivalent to 2,245,639,251 ordinary shares.
Elumelu also commented on Otedola’s recent acquisition, stating: “I am happy to see an indigenous active investor community, and I am happy that Femi is investing locally, and he should be commended for that.”
