TRANSCORP POWER: The Rise And Rise Of a Company

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With an inherited ageing and bloated workforce, entrenched in outdated operational practices and minimal accountability typical of government-operated entity, it could only be miraculous and the ingenuity of men with Midas touch for a power plant operating 164MW to suddenly upscale to about 670MW within four years.   This is the story of Transcorp Power Plc, an electric power generating company and subsidiary of Transcorp Plc which bought the old Ughelli Power Plant (UPP) through the privatization process.

Transcorp Plc; a power subsidiary of Transnational Corporation Plc (Transcorp Group),  with 51% stake in the consortium arrangement with others in what was then known as Transcorp Ughelli Power Plant had bided for the acquisition of UPP offering $300 million which invariably became the winning bid.   The plant’s output was merely 164MW, significantly below its installed capacity of 972MW with many of the turbines in varying states of disrepair and some even cannibalized for parts to repair others.

Despite these challenges, the management of Transcorp Plc under the leadership of Dr. Tony Elumelu were driven by a vision to establish an integrated power company that would contribute to national development and generate value for its shareholders The recent listing of Transcorp Power has cast a spotlight on the significant achievements stemming from the foundations established nearly a decade ago by the pioneer management, simultaneously opening new avenues for potential investors to join in what has turned a success story.

With the company now valued at $1.1 billion, from its initial acquisition prize of $300 million,  Transcorp and its collaborating entities have generated over $800 million in value within ten years. This remarkable growth is evidenced by the surge in power output from an initial 164MW to a peak of 670MW in 2017, and a current stable capacity of approximately 500MW.  Moreover, the transformation includes a streamlined and skill-enhanced workforce alongside notable improvements in operational efficiency.

It is revealing that the Nigerian Stock Exchange (NGX) mandates that listed companies offer 20% or N20 billion (in value) of their shares as free float.

However, the shareholders of Transcorp Power have exceeded this requirement threefold, contributing well beyond the N20 billion mark, amidst a significant overflow of demand from investors eager to partake in the company’s success narrative.  Transcorp Plc’s shareholders are witnessing the fruits of their investment, as Transcorp maintains its majority stake of over 50% in Transcorp Power. Consequently, all the benefits stemming from the growth of Transcorp Power are set to continually flow back to Transcorp shareholders in the form of dividends, ensuring a sustained reward for their investment.

The appreciation in Transcorp Plc’s share price reflects investors’ recognition of the synergy between the market capitalizations of both companies. Moreover, Transcorp Plc’s retention of a majority stake exceeding 50% ensures its continued influence over the operations of the power company, reinforcing a commitment to sustained corporate governance practices and robust profit growth.

It is interesting to note that Transcorp Plc is not only the core investor and majority owner of Transcorp Power Plc but also holds significant stakes in the Abuja Electricity Distribution Company and Afam Power Limited, positioning it as a leading entity in a sector crucial for the nation’s meaningful development.

Little wonder therefore Transcorp Power Plc could gain 10% on the first day of trading following its listing on the Nigerian Stock Exchange.

Transcorp Power Plc, has listed its shares via introduction on the Main Board of the Nigerian Exchange (NGX), adding more than N1.8 trillion to the market capitalization of NGX and further boosting liquidity in the Nigerian capital market.  The listing was celebrated on the 4th of March 2024, with a Closing Gong ceremony and a “Facts Behind the Listing” presentation.

The Power company had gained 10% on the first day of trading, to close at N264 per share, up from the listing price of N240 per share.  The listing of Transcorp Power is further evidence of the execution of Transcorp Group’s integrated power strategy, ensuring Nigeria’s natural resources are harnessed for the development of the Nigerian economy and so delivering on the Group’s mission of “Improving Lives and Transforming Africa.”  The listing which came on the 10th anniversary of Transcorp Power’s founding, demonstrates the Company’s strong corporate governance, operational excellence, and value creation for stakeholders.  This track record was earlier recognised in May 2023, when the Company became the first successor Power Generating Company in Nigeria to receive its post-privatization discharge from the National Council on Privatisation, having met and surpassed the key performance indicators set out by the Bureau of Public Enterprises (BPE).

Following the acquisition of the Ughelli Power Plant in Delta State with installed capacity of 972MW but operating at 160MW,  Transcorp Power invested and increased the available capacity to 680.83MW (a 227% increase) within four years of acquisition, surpassing the 5-year target of 670MW set by the Bureau of Public Enterprises. Transcorp Power Plc is a member of the West African Power Pool and a participant in the ECOWAS Regional Electricity Market. Today, Transcorp Power supplies electricity to the ECOWAS Regional Market.

 It is unarguable that the achievement so far could only have come from the unwavering dedication to powering Nigeria’s growth by the management of the company.  The journey for Tony Elumelu and others behind Transcorp had been embarked upon with a sense of purpose, innovation, and a commitment to continue to deliver sustainable energy solutions in Nigeria and beyond.

To Tony Elumelu, the listing in the Nigerian Exchange marks a historic moment for Transcorp Power Plc. “This milestone reflects Transcorp’s commitment to catalysing economic growth and prosperity.  We invest in strategic sectors within the economy, transform, expand businesses, and consciously seek ways to share value.  Our track record is evident with Transcorp Hotels Plc and now Transcorp Power Plc.  We are focused on improving access to electricity for all, creating lasting value for our shareholders and contributing to our nation’s development.”


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