Controversies around the sale of the Aluminum Smelter Company of Nigeria ( ALSCON) which have locked down that very important federal government asset for 16 good years would apparently linger for a while as the Bureau of Public Enterprises ( BPE) and preferred Bidder- BFIG of United States of America engage in fresh counter claims.
The fresh controversy bothers around alleged financial inducement, unfaithful implementation of Share Purchase Agreement, among others.
According to reports, ALSCON plant was designed to produce 187 tones per year (t/y), with capacities to process about 375, 000 t/yr of alumina and 80, 000 t/yr of coke, 20. 150 t/yr of pitch, and 193, 000 t/yr of aluminium as billets, ingots or slabs, with 85 per cent export.
The government intention for the plant built by FEEROSTAAL was also to enhance Nigeria’s technological breakthrough, save the country from huge foreign exchange loss, through the import of ingots by aluminium firms, and also help the country earn more FX through export of ingots.
After its maiden shutdown in 1999, ALSCON was resuscitated in 2006 and privatised in circumstances which many say was controversial. With a price of $410m, BFIG had emerged the preferred bidder, but in a shocking move, the BPE handed the firm to RUSAL Aluminium of Russia – a decision which led to about 16 years of intensive legal tussle over the ownership of ALSCON.
The BPE had claimed that the BFIG does not have the financial capacity to pay for the Smelter Company which has the capacity of providing about 8,500 direct jobs and 35,000 indirect jobs to Nigerians if it was functioning.
But so eaking with journalists in Abuja, BFIG President, Reuben Jaja faulted BPE claims and alleged that it deliberately frustrated his company’s attempts to take over ALSCON. Jaja said the privatization body rather altered the contents of the original 58-page Share Purchase Agreement ( SPA), reducing that document to just 16 pages, and in the process cut out most vital aspects including an important provision which addresses gas purchase agreement.
He faulted BPE’s claim that BFIG was presented with SPA on more than one ocassion , but failed to make payment.
” That’s another lie. In 2012, after more than four months of the Supreme Court’s judgment, the BPE DG at the time agreed to give BFIG the same 58-page SPA given to UC RUSAL in 2006 to sign. The document contained almost all what BFIG agreed to as bidders at a special technical conference of all parties to the bid in 2004, including BPE and all the bidders” .
” In the meeting, it was agreed that whoever emerges winners will be invited by the BPE to negotiate the SPA, after which 15 working days will be allowed for the winner to make payment. Immediately, BFIG received the SPA, it did not waste time to sign it. This was in October 2012. In the transmittal letter to BPE, BFIG requested from BPE to provide its account coordinates to deposit the $41 million initial payment. One month passed, BPE did not give any response. We wrote them a reminder. Still no response between October 2012 when BFIG returned the completed SPA and January 2013. Later, they wrote to apologise that they were organising so we can go and inspect the property and conduct a technical audit, so that we know what we were buying” .
” When the then BPE DG (Bola Onagoruwa) refused to change the decision, she was fired from office. After four months, all of a sudden, BPE abandoned the 58-page agreement we had signed and returned to them” .
” The new DG then (Benjamin Dikki) came in January. His first job was to give BFIG a brand new agreement. This time, only 16 pages. BFIG reviewed this 16-page document, and wondered how BPE dropped the agreement from 58 pages approved by the Supreme Court to just 16 pages”, Jaja, president of BFIG said.
According to him, ” in the new agreement, key attachments, including the source of gas supply, were removed. Everything that would make BFIG successful were carefully uprooted by BPE from the agreement” .
He said his firm could not continue with the deal with a good reason until the BPE reverts to the right thing.
” BFIG said this was not commercially viable, as no serious commercial bank would ever give a dime for such nonsense. To worsen the situation, BFIG had already submitted the other signed 58-page agreement to its Board of Directors, bankers, investors and lawyers in the United States. BPE had assured us in writing that all was well. But, that is where the new fight started after the Supreme Court ruling” .
Between 2012 and 2018, BPE continued to invite the media to misinform them that BFIG could not pay, whereas the (real) SPA has never even been given to us”, he claimed.
Jaja also alleged he rejected a $35 million offer to drop his bid for ALSCON and also, claimed that Alex Okoh, current BPE DG, also promised to help him secure a better reasonable amount above $35 million in the event he was ready to forgo ALSCON.
Narrating how government officials lured him with financial inducement with a view to dropping his bid for ALSCON, Jaja stated, ” While BPE was busy telling the media that BFIG did not have money to pay for ALSCON, Dr. Kayode Fayemi ( former Minister of mines and steel development and current governor of Ekiti state) summoned a meeting for me in his office at the Federal Ministry of Mines & Steel, Abuja. They offered me $35 million to forget about BFIG’s right to ALSCON. They wanted me to sell the Supreme Court judgment to them for $35 million.”
” When I rejected the offer outright and walked out of the meeting, DG BPE (Okoh) called me to his office and told me, even if I wanted more, he would be ready to assist in negotiating for more” .
“‘In the midnight, he kept calling my home. I was so annoyed, because I thought they were inviting me to try to find solutions to the problem.
Somebody they claimed does not have money. They were offering $35 million, with a promise to increase it? And the poor man rejected the money and insisted on getting his plant”, he alleged.
But reacting, Director General of BPE, Alex Okoh faulted Jaja’s claims.
Okoh who had severally expressed government concerns on the lingering legal tussle surrounding ALSCON said BFIG is not serious with the payment terms, claiming that the firm actually signed the SPA contrary to denial by Jaja.
Okoh also dismissed allegation of finance inducement, saying it was unfounded.
” That is totally false. He has already signed the agreement as ordered by the Supreme Court. Why did he sign it if it was the wrong one! He signed in December last year! We have a copy of the agreement and we can show it to the press if he wants. The agreement he signed stipulates that he makes payment within 15 days. He has not made any payment. It is very unfortunate that we can allow this kind of irresponsibility from a Nigerian who has done everything to castrate such a vital national asset with no intention change his behavior. It is very unfortunate. I will not condone it” .
” By the way, why would I offer him money. It is ludicrous. I am the seller of the asset not a buyer. Why would I offer him money. For what? Where do I get the money to offer him and for what purpose. This fellow is desperately trying to muddle up the truth. If he has money to pay in line with the Supreme Court judgement, let him just bring the money. Period! To try and use cheap blackmail to acquire such a strategic national asset for free or through the back door is disingenuous to be frank. It’s not going to happen. No amount of cheap blackmail will make that happen”, Okoh responded.
Onyinye Nwachukwu, Abuja
