By Everest Amaefule

The Federal Government is set to divest 24 per cent equity from the Transcorp Hilton Hotel through Initial Public Offering, the Director-General, Bureau of Public Enterprises, Ms. Bolanle Onagoruwa, has said.

The Federal Government currently has 49 per cent shareholding in the hotel.

Onagoruwa made the announcement during an All-Parties Kick-off Meeting for the sale held at BPE’s office in Abuja on Thursday, according to a statement made available by the spokesman for the organisation, Mr. Chukwuma Nwokoh.

According to Onagoruwa, the kick-off signals the formal commencement of the IPO transaction with indicative timelines that are expected to end not later than September 2011.

Onagoruwa, who was represented at the meeting by the Acting Director, Mines and Steel Development, Alhaji Baba Mohammed, disclosed that the staff of Transcorp Hilton Hotel were to be allotted 10 per cent of the shares on sale.

She pointed out that government’s decision was to serve as an incentive to the workforce and ensure continued commitment to work.

The boss of the privatisation agency explained that the divesture was in line with government’s determination to reduce waste in public enterprises and also pursue an economic empowerment programme for its citizenry.

She said that the IPO was one of the most transparent strategies for divesting Federal Government shares through the capital market, adding that it would engender widespread ownership of shares.

She noted that, apart from deepening the Nigerian capital market, the divestiture strategy would also create market liquidity for investors in the company.

Onagoruwa said, “Based on reports and statistics available to us, there is no doubt that its (Transcorp Hilton Hotel) performance is above industry average.

“With the outstanding performance, the National Council on Privatisation, through BPE, deemed it appropriate to divest 24 per cent out of the outstanding FGN’s 49 per cent shares in the company to the general public.”

The hotel began operations on April 14, 1987 as NICON Hilton Hotel.

 

Source: Punch