Japan’s Chugoku Electric Power Company has invested approximately $1.2 billion to acquire a 44-percent stake in Energy Fiji Limited (EFL), a move that former finance minister Aiyaz Sayed-Khaiyum describes as one of the largest commercial investments in Fiji’s history. In a comprehensive social media update, Sayed-Khaiyum emphasized that this significant investment will not only provide fiscal relief to the government but also bolster the strength of Fiji’s energy sector.
He noted that Chugoku is a reputable utility group backed by the Japan International Cooperation Agency (JICA), highlighting its substantial technological capabilities in renewable energy—an essential resource for Fiji as the country seeks to enhance its energy infrastructure. As part of the divestment process, the Fiji National Provident Fund (FNPF) sold its 20 percent stake in EFL, while the government divested 24 percent through a special-purpose vehicle. Additionally, a further 5 percent of shares has been reserved at no cost for eligible ordinary Fijian account holders.
The current ownership structure now allocates 51 percent to the government, 44 percent to Chugoku, and 5 percent to ordinary Fijians, ensuring that Fijians maintain a controlling share of 56 percent in EFL. Sayed-Khaiyum pointed out that Chugoku’s acquisition, involving an enterprise value around FJ$1.25 billion, marks the largest single financial transaction in Fiji’s history, reflecting strong market confidence in EFL’s assets and its growth prospects.
Moreover, this strategic move has resulted in the removal of state guarantees on EFL’s borrowing, a step that historically placed a significant burden on the national balance sheet. By withdrawing these government guarantees, the risks associated with EFL’s borrowing have decreased, allowing lenders to feel more secure due to Chugoku’s involvement. Sayed-Khaiyum posited that this development alleviates fiscal pressure, thereby creating greater financial flexibility for the government.
Overall, this landmark acquisition signals a promising future for Fiji’s energy sector, merging local ownership with international expertise to enhance sustainability and growth.
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