WASHINGTON, D.C., April 17 -- The International Finance Corporation (IFC) has announced the signing of an agreement between the Government of Gabon and IFC for the privatization of the provision of water and electricity services in Gabon.
Water and electricity are provided by Société d'Energie et d'Eau du Gabon (SEEG) which has the exclusive concession for production, transportation, and distribution of both water and electricity in Gabon. It has approximately 84,000 customers for electricity and 43,000 for water.
IFC will act as lead advisor to the Government of Gabon for the preparation and implementation of the privatization process. This will be the first significant privatization in Gabon and one of the first privatizations of electricity and water services in sub-Saharan Africa.
"The privatization of the provision of water and electricity services is part of a wider government initiative to restructure and privatize most of the Gabonese public enterprises," said Philippe Lietard, Director of IFC's Corporate Finance Services Department. "The privatization of water and electricity services will be a critical step toward the implementation of this program, and it could serve as a model for privatization throughout the region."
"We believe IFC is the most able to play the role of an independent adviser, widely accepted from a political standpoint," said Mr. André Dieudonne Berre, Gabonese Minister of Privatization. "Additionally, we were impressed by IFC's successful track record in the restructuring and privatization of power and water companies."
The privatization will be carried out in two phases, a preparation phase and a implementation phase. During the preparation phase IFC will define the divestiture strategy and review the existing legal framework. The implementation phase will consist of identifying suitable investors, supervising the bidding process, and assisting in negotiations and transaction closing. A significant portion of this advisory work is being financed by the Government of Japan through the Japan/IFC Comprehensive Trust Fund.
IFC, a member of the World Bank Group, is the largest multilateral source of equity and loan financing for private sector projects in developing countries. IFC also provides advisory services to government clients covering privatization and private sector corporate restructurings.
