Indications emerged on Tuesday that Nigeria Sovereign Investment Authority (NSIA) is making moves to takeover some of the key under-performing government assets, including uncompleted power plants, in its ongoing plans to broaden the scope of its investment management roles.
Reuters quoted the authority’s Managing Director, Uche Orji, as saying that the plans to take over the plants were already in advance discussions with the government to take over any power plant that is 85% completed.
The latest development suggests that the NSIA is determined to move from managing portfolio assets to being a government-aided enterprise that will be managing critical assets.
The news report indicated that authority’s CEO did not state whether it has acquired the competency and experience to manage some of the assets it seeks to takeover, if its plans succeed.
Orji quipped: “We are looking at many industrial projects and government-owned enterprises that are either moribund or not performing sub-optimally.”
Giving reasons why the authority is foraying into asset management, Orji claimed the rising inflation and state of the government’s fiscal revenue means there will be budget constraints for critical social spending which could also impact capital injection into the sovereign fund.
Reuters quoted the NSIA boss as saying “that imported inflationary pressures and the COVID-19 pandemic meant that the government would have to allocate significant resources to social spending that may affect capital increases for the fund.”
It would be recalled that in a statement issued following the release of the NSIA’s 2021 financial statements last month, Orji said that the NSIA would continue to drive direct investments in its core areas of healthcare, toll roads, gas, industrialization, technology, ESG and financial markets infrastructure, toll roads, power, and agriculture.
The statement also indicated that asset transfer would be an important component of the authority’s growth strategy in the medium to long terms given the significant opportunities in the power and real estate in the government portfolio of assets.
Currently, the NSIA has investments in agriculture, real estate, cloud computing, gas industrialisation, health care, and tolling.