Geregu Power Plc has confirmed it has commenced discussions with relevant stakeholders and advisers to resolve concerns surrounding its N40.09 billion bond repayment obligations, following a default on its latest coupon and principal payments.
The company defaulted on the eighth coupon payment and fourth bullet principal repayment of its N40.09 billion Series 1 Senior Unsecured Bond, which was issued to support its funding requirements and planned expansion projects.
The power generation company missed the eighth semi-annual coupon payment and the fourth bullet principal repayment of its Series 1 Senior Unsecured Bond, which was issued on July 28, 2022, under its N100 billion multi-instrument issuance programme. The bond carries a 14.5 per cent coupon and is scheduled to mature on July 28, 2029.
The development has raised fresh concerns over the financial position of the power generation company and the broader liquidity challenges confronting Nigeria’s electricity market.
In a statement released on Wednesday, August 12, 2026, Geregu acknowledged the concerns of shareholders, stakeholders, and regulators, noting that the current Board and Management have undertaken a comprehensive review and reconciliation of the company’s transactions, liabilities, operational commitments, financing arrangements, and financial obligations.
It said, “Discussions and engagements are ongoing, and the Company will continue to act in good faith in fulfilling its responsibilities. The Board and Management remain committed to transparency, responsible corporate governance and constructive engagement with all stakeholders.”
The default coincides with a significant decline in the company’s financial performance. Geregu Power reported an 88 per cent decline in profit after tax to N2.51 billion for the six months ended June 30, 2026, while revenue plunged by 78.71 per cent year-on-year to N18.66 billion. The contraction was particularly severe in the second quarter, with turnover of only N419.1 million, representing a near-99 per cent collapse in quarterly revenue compared to N55.87 billion in Q2 2025.
Geregu attributed the operational disruption to a major N61.47 billion turbine maintenance programme, which temporarily reduced generating capacity and energy output at its 435MW gas-fired power plant in Ajaokuta, Kogi State. The overhaul, intended to preserve the long-term integrity of the generating assets, has severely affected electricity output, revenue, and cash flows available for debt servicing.
The development has drawn particular attention from bondholders and industry observers. Global Credit Rating (GCR), which assigned Geregu a national-scale long-term rating of A(NG) during the bond issuance, previously identified illiquidity in Nigeria’s power sector, a concentrated customer base, and pressure on the company’s leverage metrics as challenges. GCR also warned that delays in project execution could increase refinancing risks.
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with a stable outlook, expressing confidence that power generation and revenue would recover once the turbine maintenance is completed. However, analysts note that the bond default could strain future capital rating efforts and borrowing costs.
The company has maintained a relatively strong financial position, benefiting from an N16.12 billion reversal of financial asset impairment charges, while total liabilities declined to N239.33 billion during the review period. However, the bond default suggests that the immediate cash-flow position remains under pressure.
The recent ownership change that saw MA’AM Energy acquire a controlling stake from Femi Otedola introduces further strategic considerations. The new board, led by Senator Abdulaziz Yari, may bring political capital to navigate the bureaucracy to unlock delayed government payments under the debt settlement programme.
Geregu Power’s share price has declined by approximately 27.7 per cent since the beginning of the year to N825.70, reflecting investor concerns over earnings sustainability and the company’s ability to meet debt obligations in the near term.
The company has stated it will continue to provide the market with appropriate updates on material developments concerning its performance in accordance with applicable regulatory requirements.
Victor Ezeja is a Nigerian journalist skilled in producing insightful news analyses, feature stories, and interviews that simplify complex issues and drive informed public discourse. His work combines rigorous research, balanced reporting, and compelling storytelling to highlight developments shaping industries and society. Victor, who holds a Master's Degree in Mass Communication, specializes in energy, aviation, business, and economic reporting. He can be reached via @VICTOREZEJA on X