ALSCON’s Sale: BFIG, BPE In War Of Words

• Firm hints on conspiracy theory

BY COBHAM NSA, ABUJA – For all the wrong reasons of alleged official complacency, promoting half truths and engagement in unnecessary legal tussles, the $3.2 billion Aluminium Smelter Company of Nigeria (ALSCON) in Ikot Abasi, Akwa Ibom State, looks destined for the inglorious legion of historical memorials in Nigeria’s degraded infrastructure sector.

On the war path that is clearly engineering the possible closure and unfortunate end to this multi-billion Naira enterprise with huge prospects of providing direct employment opportunities to many Nigerians are the Bureau of Public Enterprises (BPE) and initial preferred winners of the privatization bid, the BFIG Group.

With both sides not ready to shift grounds on the matter, controversies surrounding the company’s sale is escalating by the day as accusations and counter-accusations now dot the almost 16-year-old transaction.

Firing yet another salvo at the weekend, BFIG President and Chief Executive, Mr Reuben Jaja alleged official insincerity, with claims that BPE dubiously altered attached documents in the initial Share Purchase Agreement (SPA) by producing a new 16 page, instead of the original 58 page document for their signature.

Expressing disappointment at what he described as BPE’s unfriendly disposition towards BFIG in the ALSCON deal, Jaja also accused some top government functionaries of corruptly making a $35 million offer for him to recant on the Supreme Court judgment that confirmed their rightful position in the ALSCON bid.

But the Bureau is not finding the BFIG’s bribery and other accusations funny as its Director General, Mr Alex Okoh dismissed the claims as the ranting of a desperate mind, saying; “That is totally false. 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.”

Despite BPE’s denial, Jaja is not backing down on his accusations, insisting that the Bureau has continued to run foul of the ALSCON agreement as ordered by the Supreme Court.

Speaking at a media briefing in Abuja, Jaja said given noticeable alterations in the SPA, BPE deliberately left out information that would have ensured a smooth and successful takeover of the privatised outfit by BFIG.

In offering further insights to journalists, Jaja claimed that the contentious 16-page SPA was devoid of key incentives and provisions around gas purchase agreement, describing the development as a gross violation of existing Supreme Court ruling on the matter.

The BFIG Boss explained that the 16-page SPA has totally stripped ALSCON of assets and exposed it as an entity that is not commercially viable, noting that no serious commercial bank would have interest investing funds in such an operating environment.

Jaja stated that; “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.”

Further amplifying his claims that ALSCON is not viable in its current state, the BFIG President said; “For example, list of lands; List of facilities; List of liabilities are no longer attached to that agreement. All these things were part and parcel of the initial SPA. But they detached all these exhibits which are actually the key issues in the agreement.”

Continuing with his submission, Jaja said the saddest part of things is that after the Supreme Court judgment in 2012, the KPMG audited financial report on ALSCON, with BPE sitting on the board and co-managing the firm, indicated it was now worth about $89 million, down from $1.3 billion at the initial privatisation stage, adding; “How do you want me to take $410 million and pay for an $89 million project?”

“If I dare present such proposition to my bankers in the United States, they will think I’m insane. To say, they should give me $410 million to go and pay for assets of $89 million dollars. They have stripped the assets of ALSCON. They’ve damaged the exhibit. And also the production have dropped to zero level. By 2003, Nigerians were managing ALSCON before privatisation. ALSCON had about 200,000 metric tonnes of aluminum in its production capacity. Nigerians were operating at about 32 per cent. But now, the people there have not been able to produce up to 10 per cent.”

“They offered me $35 million that I should take and forget about it. In order words, I should sell the Supreme Court judgment for $35 million. They said we do not have money to pay. And they offered somebody who doesn’t have money $35 million with a promise to increase it and that poor man said no I don’t want your money. I want my plant.”

Jaja, also spoke about conspiracy theory in the deal, saying; “There is a foreign interest that wants to kill ALSCON so that they will continue to export to Nigeria for their selfish benefits.”

On his numerous legal battles to straighten things out, the BFIG Chief said “Let me prove to you and I will give you facts. We won ALSCON in June 2004. Apparently, we were not the preferred choice. But God Almighty made us the preferred choice. Immediately we won ALSCON, there was an effort to take it away from us, right from the closure of the bids.

“So from 2004, BPE summoned you the media and what did they tell you? ‘They couldn’t pay. BFIG couldn’t pay. That was why we cancelled the deal and nullified their bid. They said this blatant lie in 2004. They summoned you again in 2005 and shared this blatant lie in 2005. Same in 2006, 2007 2008 2009, 10 11 and 12. A period of eight (8) eight years. They served you nothing but lies.

“Do you know what happened? In 2012, the Supreme Court of Nigeria, in a vote of 5-0, said it was a lie. You (BPE) have not even gotten to the point of payment. Not one member of the Justices on the panel dismissed our application. The entire five members, including the current Chief Justice Mohammed Tanko, agreed with our submission then.”

However, amidst the accusations from BFIG, Director-General of BPE, Mr Alex Okoh said having already signed the SPA as directed by the Supreme Court, Mr Jaja is only raising false alarm for his company’s obvious inadequacies to fulfill its payment obligations on the transaction.

Questioning Jaja’s decision to sign the SPA if it was the wrong one, Mr Okoh said; “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 to change his behavior. It is very unfortunate. I will not condone it.”

On BFIG’s payment for ALSCON, the BPE boss said; “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.”

As things stand presently, hopes of resolving the imbroglio soon seem to be dimming daily for this promising enterprise, established as a revenue generating project to save Nigeria over $3 billion of aluminium ingots and other products through import for the downstream sector yearly.