Assets Stripping Of Delta Steel Company (DSC) Causes Stirs Amog Stakeholders, Host Communities

Unless the Federal Government (FG) and the Asset Management Corporation of Nigeria (AMCON) does the needful, heads would soon roll over the purported assets stripping by the new owners of Delta Steel Company (DSC), Premium Steel and Mines Limited.

The multi billion dollars project commissioned in 1982 and sited in Ovwian-Aladja communities of Udu local government area of Delta State established to be the flagship of the steel industry in West Africa, has suffered setbacks allegedly ochestrated by bad government decisions, dishonest corporate governance, perpetrated by corrupt civil servants, politicians and Indians who have ran the steel giant aground.

Our correspodent who was on investigation tour to the troubled waters of DSC, discovered that the steel complex was the first and only integrated plants in Nigeria, consisting of units such as beneficiating and pelletizing plants, Direct Reduction (DR) plant, made up of two modules, the steel melting shop, the continous casting shop, the air separation plant, the foundry, and the general maintenance shop with feeder units in various process department without competition has alegedly become a lifeless lion.

Our search revealed how Premium Steel and Mines Limited in DSC, allegedly strip and vandalized the assets rather than production as the plants and machinery assets in the steel plant and housing estates are being dismantled, cut to pieces for sale to the general public while some equipment, used vehicles and heavy duty machines are scrapped for sale.

The act of Premium Steel and Mines Limited in an alleged clandestine move which recently stripped and sold off all electricity transformers at permanent camp steel town II, vandalized the telephone station at camp extension, removed all storage tanks and took over the technical high school account as well as issued notice to quit from one law firm Ugege & Co were discovered as more ploy to size the camp extension.

Further checks carried out by our correspodent unearthed the alleged looting of the steel complex and township 1, 2, 3 and 4 by Premium Steel and Mines Limited as 36 years after the steel company still flounders.

A petition obtained by our correspodent in the course of unearthing the mystery of DSC, dated 8th August 2016, to the Ag Director-General, Bureau of Public Enterprises signed by the president, Udu Youth Progressive Union, Freedom Ovwemejepha and Secretary, Jefia Dede, among others lamented that DSC like most other FG enterprises was run aground which led to her privatization.

The petition reads in part: "arguably, there's no gainsaying the fact that the whole essence of privatizing DSC as with other privatized erstwhile government establishments was to reinvent the wheel by making it work again and perhaps even better than when it was operated under government's control and ownership. That was our expectations as the host communities. We envisaged a scenario where our restive youths will once again be gainfully employed in a steel complex that will not only be functional but operating at full capacity to meet the competitve demands of its products".

The petitioners who could not hide their emotions, disclosed that DSC was once privatized first to Russal Steel but not without getting its fair share of neglect, "rather than revamp the steel complex, the company embarked on large scale assets stripping exercise against the spirit of the transaction. This malpractice continued unabated until Assets Management Corporation of Nigeria took over DSC and sold it to the present owners. Even though the host communities were never consulted, we however expected that the present owners should, in line with international best practices, engaged the host communities in order to achieve our mutual expectations. However, what we are experiencing presently is absolutely unacceptable to any civilized community".

According to the petition, they claimed that they have clear proof that the present owners are engaging in serious malpractices which include but are not limited to assets stripping, cannibalizing the machineries, pledging the assets of the host communities, taking over of local schools, sending their children out of school and carrying out their activities with great impunity to the detriment of the host communities.

"We are reliably informed that Premium Steel and Mines Limited has already sold the DSC Model School II", stressing that their letter to AMCON to determine the scope of the transaction with Premium Steel and Mines Limited got no response.

While noting that they are not unmindful of the possible consequences that the continued silence and inaction on the part of FG through the Bureau of Public Enterprises and AMCON might caused, they warned: "We cannot continue to fold our hands and watch our commonwealth been treated with impunity".

In another development, in a petition dated 26th September 2016, and a copy sent to the Managing Director of AMCON, by UYPU, said: "we wish to reiterate our non-negotiable stand to only support genuine investor(s) that will ensure the resuscitation of DSC plant built at enormous cost to the nation".

They held that their position is in line with the objectives of the founding fathers and the aspiration of the community and other patriotic Nigerians, revealing that Premium Steel and Mines Limited, has rather engaged a parallel faction of a youth organization other than the youth council which the new owners now perceived as enemies.

Also, further checks revealed that the handing over of DSC to Premium Steel and Mines Limited on 18th March 2015, was without any documentation but with words of mouth by the former Managing Director who came with another individual for the hand-over.

Similarly, a petition dated 30th August 2018, titled: "Stop the sales/Assets Stripping of DSC Properties (used vehicles/heavy duties) and others now", sent to the Managing Director/ Chief Executive Officer, Premium Steel and Mines Limited signed by Chief (Hon) Matthew Uparan, President General, Ovwian community, Mr. Ellas Dogene, President General, Aladja community, Evang. Emmanuel Kpomalefe, President General, Ekete community, Mr. Victor Maveruo, President General, Orhuwhorun community among others and copied to the state governor, Dr. Ifeanyi Okowa, said: "for over three years of Premium Steel and Mines Limited forceful takeover, there is still no production instead your company Premium Steel and Mines Limited is stripping DSC assets to the disadvantage of Nigeria.

"It is upon this premise that we are asking vigorously that your management should stop with immediate effect the indiscriminate sales of the used vehicles/heavy duties and assets stripping of DSC properties in the name of scraps.

"Take note that Premium Steel shall face the wrath of the core host communities if this letter is treated with levity and abject disregard", the petitioners warned.

In the course of our investigation, the management of Premium Steel and Mines Limited could not furnish our correspodent with evidences of its technical and financial proposal/capability to AMCON before been selected as preferred bidder which led to the sale of the DSC to Premium Steel and Mines Limited, business plan and post acquisition plan with targets and timeline base upon which it was selected as preferred bidder and purchase documents upon request.

But the Deputy General Manager Corporate Affairs, Mr. Emmanuel Etaoghene, said: "That is a commercial paper. It’s not for the public as such. It’s a confidential and commercial and not for public display".