Fresh bids called for Eleme Petrochemicals

18-Nov-05

The bids received for the privatization of exercise to privatize Eleme Petrochemical Company Limited were grossly below the Reserved Price(minimum price government has set based on the value placed on the enterprise by international industry experts). Following the dead end reached after the exercise to privatize EPCL, a decision to invite fresh bids was taken by the National Council on Privatisation (NCP). The federal government has annulled the financial bids submitted by the Dangote/Transcop Consortium and the Indorama Group for the acquisition of the majority stake in EPCL. The Bureau of Public Enterprises (BPE) has been asked to call for fresh bids from prospective core investors. The time frame is expected to be short this time in order to ensure a quick completion of the transaction. As problems were generated by the double bids by investors, a single bid was being considered to ease evaluation The Bureau of Public Enterprises (BPE) had allowed two bids from each prospective investor. One bid was in respect of the investors'' willingness to settle liabilities of the enterprise and the second, a bid without liabilities. In the original bids submitted by the Dangote/Transcorp Consortium, the group offered to pay $90 million (without liabilities) for 75% equity of the EPL and $5 million (with liability). Indorama bided at $120 .5 million (without liabilities) and $240.5 million (with liabilities) in the first round. In the second and final bids Dangot/Transcorp offered $201 million (without liability) and $10 million (with liability), while Indorama moved theirs to $121 million (without liability) and maintained $240 .5 million (with liability).