This Day (Lagos)

18 November 2012

Nigeria: FG Courts BFIG as Crisis Looms Over ALSCON Takeover

The Federal Government has embarked on concrete steps aimed at handing over the Aluminium Smelter Company of Nigeria (ALSCON) to Bancorp Financial Group (BFG) in line with the Supreme Court directive.

But the latest move is coming even as the Russians were said to have dragged the Federal Government before the International Court of Arbitration, London for breach of agreement as well as halt the proposed revocation or be compensated.

THISDAY learnt exclusively that the Bureau of Public Enterprises (BPE) had invited top officials of BFIG in a bid to iron out grey areas including the execution of the share purchase agreement to enable the company pay the agreed 10 per cent of the accepted bid price of $410 million.

It was specifically gathered that officials of the BPE and BFIG have at a recent meeting at the agency's head office in Abuja scheduled to visit the aluminium company on November 21, in a determined effort to conclude the handing over.

Director-General, BPE Ms Bolanle Onagoruwa had informed THISDAY that the agency would commence moves to takeover the company from Russia's Rusal in obedience of the Supreme Court order which had ruled in favour of BFIG.

But analysts who spoke with THISDAY had cast doubts over government's sincerity in heeding the judgment, questioning the entire contractual obligation between it and Rusal.

THISDAY investigations further revealed a looming legal tussle should the Supreme Court's order be compromised.

Specifically, the legal team from the BFIG are said to be gathering evidence about an alleged inconsistencies inherent in the ALSCON bidding exercise.

A source from BFIG, who wouldn't want to be named, said: "We are only awaiting the outcome of this whole issue before we embark on our next line of action. We have compelling evidence to argue our case."

Meanwhile, Rusal's acquisition of ALSCON had been dogged by controversy, as the Russian firm did not win the bid during financial bid opening process held by the BPE.

Rather, the BFI Group, which was the preferred bidder, was side-tracked by former President Olusegun Obasanjo at the time and Rusal was selected to acquire ALSCON.

Displeased by the Federal Government's decision, BFI went to court and got a Supreme Court ruling in its favour last July.

However, Rusal had said it was determined to resist any attempt by the Federal Government to implement the Supreme Court judgment.

Notwithstanding, the BPE said it would eject the Russians from ALSCON while the negotiations from compensation continued.

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