Africa-Press – Kenya. Kenya Power has hired Deloitte & Touche LLP to lead the process of on boarding independent directors to the board.
This is in line with the recent amendments to the Company’s Articles of Association, which now gives minority shareholders a voice in decision making.
During an Extraordinary General Meeting that was held on November 10, ,shareholders approved the amendments, key among them the restructuring of the board of directors to reflect the Company’s shareholding structure.
Following the approval, four directors will be elected by private shareholders (minority shareholders) while the other five directors will be appointed by the National Treasury (majority shareholder).
The government holds 50.09 per cent of the company’s shares.
“Deloitte & Touche LLP will oversee the nomination and election of the independent directors to give assurance on the integrity of the process and provide the required support to the board of directors,” management said in a statement on Thursday.
The changes in the structure of the board are meant to safeguard the interests of both minority and majority shareholders, it said, in line with good corporate governance practices.
Further, the changes are aligned to the government’s commitment to transform Kenya Power into a commercially viable entity, by delinking development initiatives, to allow the company to operate on commercial principles.
The accounting firm has in the past offered a number of advisory services to the utility firm.
In 2019, Deloitte won a Sh 60 million project from Kenya power, which involved restructuring services to optimise the organisational operations.
Kenya Power is among State agencies being closely monitored by the IMF which has been pushing for reforms in key parastatals which have over the years remained in losses, forcing the government to bail them out.
IMF has been pushing the government to shake up the Kenya Power board and settle about Sh26 billion owed to the company, as part of reforms to stabilise the company.
In June this year, the government committed to clear some Sh19.4 billion owed to Kenya Power under the Rural Electrification Scheme.
It also owed the power distributor about Sh7 billion as compensation for last year’s 15 per cent electricity tariff cuts.
Kenya Power is among State agencies that have over the past few years heavily depended on the Exchequer bailouts, with a liquidity gap of up to Sh64 billion as at June last year.
Electricity tariffs were this year reviewed upwards by up to 40 per cent, as one of the ways to increase revenues, which the company said was based on required resources for the sector’s sustainability.
This, as the company remains tied to expensive thermal power deals with Independent Power Producers (IPPs).
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