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FG cancels ALSCON sale to BFIG

By The Citizen
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The National Council on Privatisation headed by Vice-President Namadi Sambo has voided the sale of Aluminium Smelting Company of Nigeria located in Ikot-Abasi, Akwa-Ibom State to BFIG Corporation of America.

A statement issued by the Head, Public Communications, Bureau of Public Enterprises, Mr. Chigbo Anichebe, in Abuja on Tuesday, attributed the voiding of the sale to the failure of the American company to meet the 15-day deadline for the payment of 10 per cent of the bid price.

According to Anichebe, by the end of the deadline on Monday, the company could not meet up with the payment of 10 per cent bid price within 15 working days of the execution of the Share/Sales Purchase Agreement as directed by the Supreme Court.

'The deadline for the execution of the SPA and payment of the 10 per cent of the offer price elapsed at midnight Nigerian time on the March 18, 2013, and as at that deadline date, the BFIG had neither executed the SPA nor made the initial mandatory 10 per cent of the bid amount,' Anichebe said in the statement.

The Supreme Court had in a July 6, 2012 judgment, voided the sale of ALSCON to Russia'a RUSAL and instead awarded it to the BFIG Corporation.

In compliance with that judgment, the BPE had transmitted an offer letter and the Share Sales/Purchase Agreement in respect of ALSCON to BFIG.

This followed the directive of the NCP, which met at the Presidential Villa, Abuja on January 22, 2013.

BFIG, the plaintiffs in the suit at the Supreme Court, was expected to execute the SPA and pay the agreed 10 per cent of the offer price of $410m within 15 days of the execution of the SPA as directed by the Supreme Court, Anichebe said.

According to him, the BFIG had in disregard of the apex court, drafted and executed an agreement that was different from the one ordered by the court.

However, in its reaction, the BFIG faulted the decision of Federal Government to void the offer to purchase 77.5 per cent of ALSCON.

The Chairman, BFIG, Dr. Rueben Jaja, said BPE had no such powers to cancel a transaction ordered by the Supreme Court.

Addressing journalists in Abuja shortly after the announcement, he said BFIG had instituted a suit at the Supreme Court seeking among others an order compelling BPE to allow the group to take full ownership of the aluminium plant

Jaja said the total value of the plant when it was audited in December 2011 was $89.99m and wondered why BPE was asking it to pay $410m as contained in the new SPA sent to it.

He said the issue was not about the ability of BFIG to pay for the plant but the inability of BPE to mutually agree with it on some contentious issues, including the bid price for the plant.

Jaja said, 'The Supreme Court has ordered that the SPA should be one that is mutually agreed to by both parties. I am sure it was not the intention of the court for us to pay $410m for a company that is valued at $89m.

'The whole package is to frustrate us when they knew the plant is not worth that much. We are asking the court for an order directing the BPE to fully enforce, fulfil and give effect to the meaning and intendment of the July 6, 2012 judgment.'