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Senate Wants Sale Of Delta Steel Revoked

Source: EMMA UCHE, THEWILL. - thewillnigeria.com
L-R: BPE BOSS, MS. BOLANLE ONAGORUWA, MD, ELEME PETROCHEMICALS LIMITED, MR. MANISM MONDRA AND CORPORATE ADVISER JOSSY NKWOCHA BEFORE THE SENATE AD-HOC COMMITTEE TODAY, AUGUST 09, 2011, AS HEARING CONTINUED IN THE PROBE OF THE PRIVATISATION PROCESS.
L-R: BPE BOSS, MS. BOLANLE ONAGORUWA, MD, ELEME PETROCHEMICALS LIMITED, MR. MANISM MONDRA AND CORPORATE ADVISER JOSSY NKWOCHA BEFORE THE SENATE AD-HOC COMMITTEE TODAY, AUGUST 09, 2011, AS HEARING CONTINUED IN THE PROBE OF THE PRIVATISATION PROCESS.
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ABUJA, August 09, (THEWILL) - The Senate Ad-Hoc Committee probing the commercialization and privatization activities of the Bureau of Public Enterprises (BPE) has advised the bureau to return the ownership of the Delta Steel Company, Aladja, Delta state to BUA group of companies who originally bided and emerged successful as the preferred bidder of the company.

The BPE was also asked to return the sum of N4 billion being five percent of the total amount paid to buy Eleme Petrochemical Company Limited by Indorama back to the company because the extra five percent was illegal since it is by law reserved for the federal government who are to own five percent stake in the petrochemical company. The company already has 75 percent share following its purchase of the company in 2006 at the sum N3.2 billion but was asked to make an additional payment for the five percent stake.

However, the advice means a subtle directive to BPE to revoke the earlier purchase of the company by the Global Infrastructure Holden Limited, because they neither bided for DSC, nor emerged as the preferred bidder.

According to a Director General of the BPE during the sale of the steel company, Dr Julius Bala, the preferred winner of the bid was BUA group of companies but the federal government at that time preferred to sell to Global infrastructures.

Dr Bala said, “There was a bid and BUA emerged winner and when they were submitted to the National Council on Privatization (NCP), they directed the DSC must not be sold for anything less than $25 million.

“A committee was set up made up of the Ministers of Power and Steel, Transport and Justice to look into the privatization of enterprises in the steel sector. The committee was set up and the Ministry of Power and Steel took responsibility for the sales which included Itakpe Iron Ore and the Ajaokuta Steel Company. The Minister of Power and Steel took responsibility for the sale of DSC. I was barely involved.

“The National Council on Privatization never gave approval for the bid by BUA. The document of BUA was submitted to the then chairman of NCP and later to the President and the bid was very low at $25m. Subsequently, a committee was setup. BUA participated in the negotiation with the power and steel Minister. And they subsequently made an offer of $25m which was rejected by the committee because there was $30m by the global Infrastructure,” he said.

Though Bala admitted that he signed the Share Purchase Agreement (SPA), for the purchase, he however, denied signing the letter which gave BUA approval to pay for DSC.

“Before the DG signs any agreement, there has to be approval from the Chairman of the National council on Privatization. So there was approval given to me to sign by the NCP. I signed the agreement as the DG against the background of the political situation and despite the fact that it was made known to me that I was leaving. I was made to sign the agreement. But I was not blackmailed.

“I never signed the letter giving BUA approval to pay. I am seeing it for the first time, the signature in this letter is not mine, in this computer age anything can happen,” he declared when he was shown the letter to confirm if he was the one that signed the letter.

Bala nonetheless added that his removal from the office shortly after he signed the SPA still remains a mystery to him.”

On the Eleme Petrochemical Company, a breakdown of ownership of the company reveals that the Indorama has 75 percent share, the Nigerian National Petroleum Corporation 10 percent, host communities 7.5 percent, workers 2.5 percent and 5 percent to the federal government.

The senate ad-hoc committee however directed the BPE to suspend further transactions on the sale of federal government shares in the Eleme Petrochemical limited.