Nigeria: Helping manage the grain reserve infrastructure
Government sees private sector management skills as the solution for decaying grain silo infrastructure across Nigeria.
Challenge
Self-sufficiency in food production is top of mind for Nigeria, but grain spoilage due to lack of adequate storage infrastructure makes this goal difficult to achieve.
The responsibility to operate 33 industrial grain storage facilities with a limited budget led the Federal Ministry of Agriculture and Rural Development (FMARD) to opt for a public-private partnership (PPP).
The Ministry brought in an advisory team to support this PPP. As lead transaction expert, CPCS developed the concession strategy to safely transfer operating rights to credible private investor-operators.
Solutions
- Carried out due diligence study to identify the legal, environmental and technical implications of the concession. This phase included in-depth commercial valuation studies for each grain silo.
- Designed a procurement process to attract credible investor-operators to take over the grain facilities
CPCS assisted the Ministry throughout the four year-long concession process.
“We received almost 60 bids,” says Philip Asante, global infrastructure expert at CPCS. “But only roughly 30 were technically and financially qualified.”
Finally, CPCS advised its client during negotiations with the preferred bidders. “We played a key role in drafting concession agreements,” adds Philip.
Impact
Nigeria’s major agricultural development program is well underway.
