Sopuruchi Onwuka

The energy business empire of corporate mogul, Kola Adesina, is battling tough liquidity challenge that threatens its continued participation in the debt ridden national gas-to-power programme.

Leaders and top management executives are all pulling strings to stave off malignant legal battle waged by FBNQuest Trustees Limited to recover hundreds of billion Naira trapped in bad debts.

An executive of the company had described the public statement by the legal team of FBNQuest as designed to embarrass and harass, but many lawyers who volunteered thoughts on the matter told Oracle Intelligence that they see a determined effort at debt recovery.

From seeking mediation to calling for political intervention to resolve the crisis, executives of Sahara Group are said to be pulling strong narratives to douse tension and prevent other creditors from crowding the embattled firms.

Pundits note that the companies could possibly be exposed to other lenders; and fears are high that the ongoing efforts by FBNQuest to take over companies could trigger panic that possibly push other lenders into swooping on them.

However, the Sahara Group is said to be working hard to avert further escalation of the crisis which went public with a notice of receivership on Thursday.

Kunle Ogunba (SAN), Insolvency Forte had in a public notice claimed that it has been appointed by FBNQuest as Receiver and Manager over all know assets of KEPCO Energy Resources Nigeria Limited and its 70 percent stake in Egbin Power Plc.

Insolvency Forte stated that it was acting in pursuant of a security deed of August 21, 2013 which it said was registered with the Corporate Affairs Commission in Abuja on January 22, 2014.

“The Deed of Appointment of Receiver/Manager dated 19th day of June, 2025 has been duly registered with the Corporate Affairs Commission, Abuja,” Insolvency Forte declared.

Insolvency Forte warned all debtors to KEPCO to preserve the assets in furtherance to the prevailing receivership exercise. It also advised creditors of the energy company forward valid claims within 14 day from last Thursday.

In the publication, Insolvency Forte urged banks, companies and other institutions to freeze cash, shares and other financial instruments owned by the energy company until resolution of subsisting litigations.

Citing suits including FHC/L/CS/1281/2025, particularly FHC/L/CS/1242/2025; Insolvency Forte urged potential debtors to KEPCO Energy Resources Nigeria Limited including market operators and regulators in the Nigerian Electricity Supply Industry (NESI), financial institutions and current accounts held for KEPCO to reach the receiver for account reconciliation.

In response to the publication, Sahara Group issued a delayed statement stating that it’s subsidiaries including Egbin Power Plc, Ikeja Electric Plc and First Independent Power Limited are not in receivership.

The company declared media reports based on the publication by Insolvency Forte as false, arguing that the publication by Insolvency Forte is misleading and contrary to a subsisting court ruling.

Sahara Group listed it’s companies exposed in the insolvency battle to include “KEPCO Energy Resource Nigeria Limited, NG Power-HPS Limited, and New Electricity Distribution Company, with operating companies as follows: KEPCO (Egbin Power), NG Power-HPS Limited (FIPL) and New Electricity Distribution Company (Ikeja Electric).”

Chief Legal and Regulatory Officer at Ikeja Electric, Babatunde Osadare, stated on behalf of the power companies: “We state unequivocally and for the record that Egbin Power Plc, First Independent Power Limited, and Ikeja Electric Plc are absolutely not in Receivership, and their assets, businesses, or undertakings are not under the management of any external Receiver/Manager whatsoever,”

Osadare claimed in the statement that Justice Akintayo Aluko of the Federal High Court in Lagos had in rulings on Suit Nos. FHC/L/CS/1242, FHC/L/CS/1244, FHC/L/CS/1245, “explicitly restrained the Lenders and their purported Receiver/Manager from accelerating the disputed loan facility before its maturity; interfering in any manner with the assets, businesses, or undertakings of the Power Entities, including operational accounts; enforcing any share security over the assets of the Power Entities or their sponsors, based on the disputed debt; or unilaterally enforcing any finance documents related to the disputed debt.”

He added; “Egbin Power, First Independent Power, and Ikeja Electric remain fully operational, financially stable, and firmly under the control of their legitimate management.”

However, our findings showed that the companies facing the prevailing legal storm over bad debts cannot be “financially stable.”

It is also clear that there has been no attempt by the Sahara companies to contest the existence, scale and poor performance of the disputed debts.

The Oracle Intelligence reports that the sister companies are strategically positioned along the nation’s gas-to-power programme.

Under the commercial arrangement bonding all players in the programme, the distribution companies harness market returns and make remittances through the Nigerian Bulk Electricity Trading (NBET) Company to transmission, generation and gas companies.

Poor performance of the distribution companies including the Ikeja Electric and slow subsidy cash call response from the federal government have led to overhang of significant N4 trillion debt, leading to liquidity squeeze in the electricity supply market.

Expectations that Sahara companies would lead commercial viability in the sector with full valuechain economics have dissipated in the insolvency crisis.

Our findings also showed that internal debt amongst the sister companies is also growing and complicating external debts.

Sources within the company hinted that
KEPCO’s Egbin Power owes the parent Sahara Energy over N300 billion in gas debts.

Also, New Electricity Distribution Company which operates Ikeja Electric has a bad invoice performance record with NBET. Our sources could not confirm exact debt at the weekend.

NG Power-HPS Limited which operates relatively younger First Independent Power Limited (FIPL) is also said to hold growing debt profile.

On the whole, our findings show that apart from Sahara Energy which operates oil mining lease (OML) 148 onshore Nigerian Delta, the other subsidiaries of the group appear to wait for periodic cash interventions from the president’s office to draw lifeline.

The case is confirmed for the generation companies that export volume output to the national grid.

But for distribution companies like Ikeja Electric, the assumptions could be tricky. NBET sources disclosed that most distribution companies in the gas-to-power programme burden the system will complicated accountability.

According to a consultant that plays in the power sector, the discos, as they are known, run huge overheads while posting lean income. The situation, according to our sources, make it difficult for lenders and NBET to accurately track revenue flow.

The overall debt exposure of the Sahara companies to lenders could not be ascertained as they are said to be over 10 different banks providing different credit facilities to different subsidiaries of the group.

Critical chunk of the debt is tied to acquisition loan obtained in foreign currency in 2013.

The debt, according to our sources, rapidly worsened with the full floating of the Naira at the domestic foreign exchange market where the local currency has depreciated from about N150/$ in 2013 to about N1,600/$ in 2025.

The rapid depreciation of the Naira which is used pricing sale of electricity in the domestic market had caught the Sahara Group unawares.

It was learnt that rate for possible reconstruction of the loan has remained a sustained source of dispute between the company and its lenders, a disagreement that built up to the prevailing battle.

While the lawyers and spokesmen do the public laundry, it is discovered that executives of Sahara Group are all in the field to shop effective mediation.

More importantly, we gathered that the Group CEO, Mr Kola Adesina, is also sourcing political intervention to pour water from the top.

One of the possible ways to quickly bail out the company is to quicken the hands of government officials in injecting subsidy funds into the system to avail immediate cash that allows the company cut back its debts from the red zone.