The House of Representatives Committee on Public Assets is investigating the sale and collapse of the Delta Steel Company (DSC), Aladja, Warri in Delta State.
The committee headed by Ademorin Kuye took on the management of the Bureau of Public Enterprises (BPE), Asset Management Corporation of Nigeria (AMCON), Office of the Accountant General of the Federation (AGF) Ministry of Finance Incorporated (MoFI) among others for the sales and collapse of Delta Steel Company.
The committee is undertaking the sale of the DSC worth over $700 million sold below $30 million after a petition was submitted to the House on the matter.
Kuye said the committee is probing the purported sales of the Delta Steel Company and the controversies surrounding its acquisition by AMCON.
The Director General of Bureau of Public Enterprises, Mr. Ayodeji Ariyo Gbeleyi, told the
Reps that after the privatisation policy of the Federal Government, 80 per cent shareholdings of Delta Steel Company was sold to Global Infrastructure Nigeria Ltd (GINL) in 2005 with Federal Government (BPE) retaining 20 per cent of the shareholdings.
Gbeleyi said the DSC was worth $700 million, but 89 per cent of the asset was sold to GINL at $30 million
He said residential buildings and plots of land belonging to the Delta Steel Company were used to settle the workers and pensioners of the company.
According to Gbeleyi,
the company, GINL, after privatisation used the assets of DSC as collateral to obtain a loan from Ecobank. However, he said due to non-performance of the loan, in 2015, AMCON acquired the assets and sold them to Premium Steel and Mines Ltd.
He said AMCON did not seek clarification from BPE regarding contractual agreement before it acquired the asset and sold it to another company.
The petitioners, including Association of Concerned Residents of Camp 2, 4 and 5 of Delta Steel Company, Aladja Warri, said prior to 2015 before the involvement of AMCON and Premium Steel and Mines in DSC assets, they had been staying in the estate and plots of land which were used to settle them based on the contractual agreement.
According to Dr. David Emomotimi and Richardson Osifor, who spoke on behalf of the petitioners, since 2015 till date, the petitioners claimed that they had been under constant intimidation and harassment by police and army personnel claiming to be acting on the instructions from AMCON and Premium Steel and Mines that they should quit the estates.
The petitioners said the assets AMCON acquired were those used as collateral by Global Infrastructure Nigeria Ltd to obtain loans from Ecobank which did not in any way include the residential buildings.
Osifor said from the contract agreement and information at the Corporate Affairs Commission, the loan Global Infrastructure Nigeria Ltd obtained from Ecobank was N250 million but AMCOM jacked it up to N7 billion.
Similarly, the Director of BPE, Gbeleyi said they were only aware of the loan Global Infrastructure Nigeria Ltd obtained from Ecobank but unaware of three other banks AMCON listed as the creditors.
The representatives of AMCON, Chukwuemeka Umunakwu (AMCON legal unit) said AMCON got the assets of DSC used as collateral to obtain loan from four banks to prevent them from collapse.
According to Umunskwu, AMCON secured the assets at N22 billion but sold it to Premium Steel and Mines at N32 billion.
The Director, Finance, Kabiru Ademola in the office of the Accountant General of the Federation said there was
receipt of payments by both BPE and AMCON in respect of sales of Delta Steel Company’s assets, adding that there was a payment of of N3 billion in favour of BPE in respect of sales of 80 per cent of DSC assets to Global Infrastructure Nigeria Ltd.
He said the AGF was yet to receive any information from the Central Bank on the claim of payment of N32 billion by AMCON in respect of DSC assets to Premium Steel and Mines Ltd. Though AMCON claimed the money was paid to FG account, (TSA), the agency was unable to provide the proof of payment to the committee.
The Managing Director/CEO of the Ministry of Finance Incorporated (MOFI), Dr. Armstrong Takang told the committee that though the MOFI is responsible for overseeing the management of assets and investments in the country, the agency withdrew from the issue of Delta Steel Company due to so many controversies.
Takang expressed worry over the collapse and death of Delta Steel Company and similar ones in the country, saying “If our forefathers who were less exposed and less educated would build such infrastructure and maintaining it by our contemporary leaders who are more exposed and educated than them will be a problem, I wonder what will be the future of the country.”
The committee ordered AMCON and Premium Steel and Mines to stop harassing the residents of the estate in Delta Steel Company until the investigation is completed.
