OBASANJO RUINED PRIVATIZATION -EL RUFAI

By NBF News
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Former boss of the Bureau of Public Enterprises (BPE), Mallam Nasir el- Rufai, yesterday in Abuja revealed that former President Olusegun Obasanjo allegedly ignored an advice to appoint his successor from within the agency.

The former BPE Director-General was testifying before the Senate Ad-hoc Committee on Privatisation and Commercialisation probing the sale of Federal Government companies. It was on the fourth day of the investigation by the Upper Legislative Chamber of the role of the BPE in the sale of the firms from 1999 till date. The committee yesterday ordered the arrest of Chairman of Transcorp Hilton Plc, Otunba Funso Lawal for failing to appear before it.

El-Rufai told the Senator Ahmed Lawan-led committee yesterday that based on the quality of training of the BPE staffers, the former president had no reason to look elsewhere for his successor.

He recounted how, against advice, Obasanjo allegedly appointed a former director of the BPE, who was investigated and sacked from the same agency over alleged corruption. Dr Julius Bala succeeded el-Rufai at the BPE in 2003.

A former minister of the Federal Capital Territory (FCT), el-Rufai, also explained how political interference has affected the BPE.

His words: 'I left the BPE more than eight years ago, so you have to forgive me if I think this probe is a witch-hunt targetted at me because of my critical stance against the Yar'Adua/Jonathan's administration

'I suggested to Obasanjo when I was leaving that my successor should come from within the BPE because we spent a lot to train people. But the government decided not to appoint anybody from within BPE and went outside to bring someone who was literally fired from BPE to head the same organization.

'That was the beginning of BPE's problem except (on) the occasion where Obasanjo blocked the privatization of Nigeria Airways and the result is the demise of the national carrier now.

'The authority appointed people who did not know what privatization was about, who saw the BPE as a cash cow. During my time, we always played by the rules. I never accepted interference from anybody, no matter how highly-placed.

'During my tenure, 33 government companies were privatized and 23 were concluded, five were put on hold and all, but one, are doing well. We remitted N57 billion to the government treasury from the proceeds.

'Nobody interfered with our activities. We ran a transparent organization, we never investigated anybody for corruption. But somebody we fired due to corruption ended up heading the BPE.

'The legal framework for privatization can be improved. We need to have the right people in BPE and protect them from political interference.' Meanwhile, the Bachama Consultative Forum of Adamawa State, host community of the Savannah Sugar Company Limited in Numan, have appealed to the committee to help resuscitate the 40-year-old company. The Bachama Forum told the Senate panel that the privatization of the sugar company rather than being a blessing, 'has turned out to be a curse.'

They urged the Senate to revoke the sale.
Meanwhile, the committee has ordered that Transcorp Hilton boss, Otunba Lawal, be arrested for non-appearance after being summoned. Senator Lawan gave the order after waiting for Transcrop Hilton to put up an appearance after Daily Times of Nigeria (DTN) rounded off its testimony.

Lawan said that the Senate would not hesitate to invoke its powers to compel its invitees to appear before the committee.

He said: 'We have the power to issue warrants. Where is Transcorp? Secretariat, please, issue a warrant. Get Transcorp boss arrested. Whoever thinks we are joking here will have himself to blame. Please, liaise with the Sergeant-At-Arms.'

Earlier, the committee heard how Folio Communications paid nothing for the Daily Times acquisition, sold its assets before it could pay N1.2 billion to the BPE after being named as the preferred bidder. Thereafter, the committee was treated to a crossfire exchange between Folio Communications and DSV in respect of the sale of the Daily Times. Chairman of DSV, Senator Ikechukwu Obiorah, spoke first. He told the committee how Folio Communications sold 40% shares to his company at N500 million, sold the NSE building on Customs Street in Lagos and gave out N180 million of the proceeds as bribe to NSE officials whom he did not name.

'Folio bought DTN in June 2004 after having emerged the preferred bidder and approached my company for N500 million by selling 40 per cent shares. They didn't have the money and they also approached Hallmark Bank (now defunct) for a loan of N750 million.'The BPE failed on Folio because there was supposed to have been due diligence, but it wasn't done. Folio told BPE that its net worth was N6.1 billion. These facts were submitted to the BPE and on that basis, handed over DTN to them.'Foilo now turned around and mortgaged DTN assets to Hallmark. The moment they took over, Folio pounced on the assets and started selling.

'Folio sold the building housing the Nigeria Stock Exchange (NSE) and DTN properties in London. All the assets of DTN have been sold. They were charged by the Federal Government to a Federal High Court in Lagos for obtaining DTN under false pretences.' Senator Obiorah told the committee that based on the court ruling, Folio 'has been removed from the shareholding of the company.' The former lawmaker informed the committee that DSV, which now owns DTN, has commenced moves to recapitalize and revive it which would hopefully commence publication in January 2012.

'We are raising N3 billion to start afresh. Folio are no longer directors in DTN, the court has said that. DSV now owns DTN, but the title is still resident with Afribank because of the mortgage. We hope to revive DTN by January 2012.'

Chairman of Folio Communications, Mr Fidelis Anosike, however, fired back.

He raised the alarm that DTN had been hijacked by Senator Obiorah's DSV and pleaded with the Senate to help Folio recover the media conglomerate.

Mr Anosike told Senators that Folio got a 'personal loan' of N500 million from Ben Okoye of DSV and not Senator Obiorah.

He acknowledged that Folio sold three main DTN assets including a building at Apongbon Close for N600 million which was initially valued at N280 million; shares in NSE at N720 million and a property in London for 520, 000 pounds.

'The N500 million borrowed from DSV was to augment the loan we got from Hallmark.'

During cross-examination from the committee chairman on the collateral tendered for the loan, Anosike replied that he tendered 'personal assets and assignment of shares. BPE approved it…'

But Anosike insisted before the committee that 'at that time, DTN was not even in our possession.'

He also admitted that Folio is 'asking for help. We are stranded.

Senator Lawan asked him about the staff strength of the company when he said DTN operates as an on-line newspaper. The Folio boss said: 'We inherited 900. Today, we have 120.'A furious committee chairman noted that 'by simple arithmetic, you have dislodged over 700 Nigerians and you want to run DTN on-line? Please, submit documents to us, for us to know who the real owner is. It's rather unfortunate.'

The committee has resolved to visit DTN headquarters in Agidingbi, Lagos when the BPE Director General, Ms. Bola Onagoruwa told Senators that 'BPE has been denied access to the company.'

It was the turn of the concessionaires of the Lagos International Trade Fair Complex who sang discordant tunes before the committee with four different companies laying claim to the complex.

Foremost concessionaires of the Trade Fair Complex, Stakeholders Forum yesterday accused the government of conniving with AULIC Nigeria Limited to illegally the entire complex at a reduced bid of N10 billion.

The forum had initially bid more than N70 billion for a lease of 50/99 years but were later denied the right to operate the entire complex.

They claimed that the complex was later cut into several units and leased out to different companies.

Speaking before the committee, former boss of the BPE, Dr Christopher Anyanwu, described how sale proceeds of privatized companies are kept in some commercial banks (in contravention of the Privatisation Act) before they are forwarded to the Central Bank of Nigeria (CBN).

Dr Anyanwu opened up on the involvement of 'certain interests' in the sale and reversal of NITEL.

'Certain interests stalled the sale of NITEL. Whoever sits on the seat as BPE DG is under serious pressure from even quarters you don't expect. That is why the process doesn't work.'

Asked by Senator Lawan who the 'certain interests' were, Dr Anyanwu said they are 'officials in the Presidency, at the highest level.' Pressed further by Lawan to reveal the names of the officials, he balked and said: 'I can't mince words here but as a lawyer, I have to be tactical.'

The former BPE boss faulted the concessioning and privatization programme. 'Concessions are wrong. Road and terminal concessions are wrong. It doesn't have a beginning or an end. There has to be a channel that is legal and enforceable and not a way where people have access to powers that be.

'In privatization, the Federal Government shares shouldn't be diluted. Any company that takes over is simply an investor… '

On the practice BPE adopted concerning proceeds of privatized companies, Dr Anyanwu said: 'The practice I met was that there were various accounts in commercial banks and the CBN, but I stressed the need to comply with sections 19 and 20 of the BPE Act.'

Section 19 deals with the Privatisation Proceeds Act and section 20 is Fees and Charges Act which stipulates that the proceeds first be warehoused in a commercial bank before it is transferred to the BPE account in the CBN.

'Management accepted my suggestion and we complied. Before then, proceeds would wait six months in a commercial account before it is remitted to the CBN.'

There were hints that the time frame for the public hearing may be extended over the non-appearance of 'certain stakeholders.' On Wednesday, Senator Lawan told Daily Sun that former ministers of power and steel may be invited to shed light on some of the privatized companies. They were yet to appear before the committee as at Thursday evening.