Privatization of Jordan’s electricity generating sector continues

19 November 2007 – The privatization of the Central Electricity Generating Company (CEGCO) continues with the investment unit of the Social Security Corporation (SSC) purchasing a 9 per cent stake for JD 16m ($23m).

The deal leaves the government of Jordan with a 40 per cent equity. Last September, ENARA Energy Arabia purchased a 51 per cent equity in CEGCO for $320m. JD Energy is the investment arm of JD Capita (Jordan Dubai Capital).

This means that 60 per cent of CEGCO is now owned by the investment unit of the SSC and ENARA, which comprises JD Energy, the Malaysian electricity giant Malakoff and the Athens-based Consolidated Contractors Company.

The sale was signed by Finance Minister Hamad Kasasbeh on behalf of the Jordanian government and by Mufleh Aqel, president of the SSC’s investment unit.

The signing covered three agreements, the first of which included the sale accord, price and special terms. The second agreement covered the provisions of the partnership between the shareholders and the management structure, while the third accord covered the guarantees granted by the government for CEGCO and the investors.

“This purchase will not be the only one of its kind as you will be seeing effective participation in other sectors like water, telecommunications and transport,” Bassem Salem, SSC chairman said, describing the drive of investments in infrastructure as one of the new key focuses of the investment unit.

Aqel highlighted the energy sector, and electricity in particular, as a priority for the unit’s strategies noting that the current stage of reform and development in the energy sector requires huge investments to keep up with the needs of the national economy.

“Al Manakher electricity station, the upcoming Al Qatraneh station and Al Samra station that the government intends to privatize are all within our interests and subject to in-depth studies by the unit,” he said.