The Lagos State House of Assembly has granted the request of the State Governor, Mr Babajide Sanwo-Olu, for the state government to assume full ownership of the privately-owned Lekki Concession Company Limited (LCC).
This follows the Executive’s request received by the lawmakers on June 21 and the subsequent directive to the House Committee on Finance to further look into it and report its findings to the House.
Six weeks after the mandate was given, the House Committee on Finance led by Rotimi Olowo submitted its report to the lawmakers.
Giving his presentation on Monday, Olowo explained that upon the buy-out of all the shareholdings interest of LCC by the state, the government has become the subsisting shareholders of the company with 75% shareholding while the Office of Public-Private Partnerships was left with the remaining 25% shareholding.
According to him, the original $53.9 million loan obligation from a private sector facility – the African Development Bank (AFDB) had been resolved after series of engagements between the bank, LCC, and the state government.
This was to convert the loan to a public sector facility with the benefit of a considerable reduction in interest charges of 1.02% of $1.12 million bi-annual, as against the 4.12% of $2.746 million per bi-annual, thus giving a savings of $1.16 million bi-annual or $3.24 million per annum.
At the end of Olowo’s presentation, the House granted the executive the approval to convert the AFDB loan to the public sector loan, backed up by a sovereign Federal Government guarantee on behalf of the state government.
It also authorised the state government to issue a counter-guarantee in favour of the Federal Government along with an Irrevocable Standing Payment Order (ISPO) to deduct from Lagos State Government statutory allocations.