This research work is aimed at determining whether privatization can be a good alternative
development strategy for the country. The theoretical foundation of privatization is embodied in
Kyenesian inability to solve the economic recession. This led to casting doubt on the ability of
public enterprises to fulfill the propelled and enduring growth of the economy. Some of the
problems of public enterprises in Nigeria include: poor human and materials management, lack of
strategic management, poor debts management, etc. The Technical Committee on Privatization
and Commercialization used various methods in privatizing the state owned enterprises. The
methods include: public offer for sale of shares, through the Nigeria Stock Exchange, private
placement and the sale of assets. These methods were evaluated in this study. Despite the
upsurge literature on privatization, little empirical knowledge is available on the performance of
privatized Companies. Can the privatized firms better than before privatization?. This thesis
was carried out with broad objective of assessing and evaluating the challenges and the prospects
of privatization exercise in Nigeria. Secondary data were obtained from BPEs Reports, TCPC
Reports, First Bank of Nigeria Annual Reports, Journals and other sources. The difference of the
two main means was used as the statistical tools to test the research hypothesis. The results shows
that their has been significant improvement in the performance of the sampled companies after
privatization then before privatization. This shows that privatization is a good alternative
development strategy. The analysis of variance used in this study confirms the expectation that
privatization enhance efficiency.