Little light on power sale

With Fiji caught in the darkness of a descending cloud of COVID-19, its government has pushed through the sale of a large portion of the national energy company to a Japanese consortium.

In its initial announcement, the government said it had sold 44% of Energy Fiji to Chugoku Electric Power Company. That stake was made up of shares held by the government (24%) and the Fiji National Provident Fund’s 20%  share.  

On June 3 of this year, Attorney General and Minister for the Economy, Aiyaz Sayed-Khaiyum, told parliament that the State received “about $440 million” (US$212 million) from the consortium. This equates to “about” $2 per share for 220 million shares (EFL has issued 500 million shares in total).  

The first attempts to sell a 44% stake in EFL were made in 2015. When there were no international takers, shares were sold to the Fiji National Provident Fund as a stop-gap measure. In April 2019, Sayed-Khaiyum said Fiji had rejected an offer from a Malaysian company which wanted total control of the company. “It was always understood that FNPF will hold on to the shares until the Government finds a strategic partner to buy the 44%, in which case FNPF will sell its holding, as per the sale agreement,’’ he said.

FNPF bought 20% of EFL (or 100 million shares)  from the government for  $206,109,989.13 in October 2019 according to its Annual Report for that year. That equates to $2.06 per share. EFL’s net asset value as of December 31 of that same year was $850.79 million.

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