Vanguard (Lagos)

26 November 2012

Nigeria: Alscon Sale - Rusal Ignores S-Court Ruling, Dares FG

Abuja — Effort by the Federal Government to comply with the Supreme Court ruling ceding the management of the Aluminium Smelter Company of Nigeria, ALSCON, in Ikot Abasi, Akwa Ibom State to its rightful buyers, BFIG Corporation, has been rebuffed by Rusal, the Russian Aluminium Company, that was sacked by the apex court.

It would be recalled that the Supreme Court had on July 6, 2012, voided the sale of ALSCON by the Bureau of Public Enterprises, BPE, to RUSAL on the grounds that the BFIG Corporation offered a higher amount of $410 million as against RUSAL's $250 million for the purchase of the plant.

The court also ordered BPE to collect the 10 per cent initial bid price within 15 days of signing a new Share Purchase Agreement with BFIG and restrained the agency from discussing or negotiating the sale of the plant to any other company apart from BFIG.

In a preliminary move to ascertain the state of the plant with a view to handing over to BFIG, the BPE informed RUSAL of its intention to carry out an assessment of the plant with a view to obtaining its status report.

The National Council on Privatisation, NCP, had ordered PBE to urgently carry out the assessment and turn in the status report on the company and to submit a roadmap for resolving all the issues relating to ALSCON sale in line with the Supreme Court ruling.

The BPE immediately raised a stakeholders committee headed by Mr. Emmanuel Ijewere to undertake the assessment, which was slated for November 23, 2012. Other members of the committee were Engr. Patrick Ikediashi, representing NCP Chairman; a representatives of the Ministry of Mines, Justice, BPE and the Nigeria Police. The BFIG was to send an observer to join the team to Ikot Abasi for the assignment.

BPE also intimated BFIG of the planned inspection visit to ALSCON and asked it to send in its team, prompting the company to move in a 14-man technical team drawn mostly from General Electric of the United States and some Nigerian experts in aluminium technology, led by its chairman Dr. Reuben Jaja and Jimmie Williams from the US.

RUSAL aborts inspection visit to ALSCON

However, when RUSAL got the BPE letter asking it to prepare for the visit, which was scheduled for last Wednesday, it quickly moved to rubbish the trip by querying the Federal Government agency on the motive of the visit and why a member of BFIG, the Nigeria Police should be included in the team.

A letter dated November 19, 2012 and personally signed by the Managing Director of RUSAL, Mr. Anthony A. Polovov, also politely informed PBE that the company does not have the facilities to accommodate high-ranking governmental delegation and would therefore not be able to entertain them.

The company's letter addressed to Ms. Bolande Onaguruwa, Director General of BPE, said: "We acknowledge the receipt of your letter dated November 15, 2012, which contains a list of 12 persons who are to visit the ALSCON next week.

"To enable us to prepare for the visit, please be kind as to communicate to us beforehand, the following: the purpose of your delegation's visit to ALSCON plant, the agenda of the visit, and in particular, the specific items you will like to discuss with us, and whether there are persons in your delegations who are not officials of BPE.

"If any non-BPE persons will be attending, what are their names and what is the purpose of their participation? Why will a representative of the Nigeria Police be attending the visit to the plant?

"Please note also that, unfortunately, the ALSCON Smelter does not have the facilities necessary to accommodate the high-ranking governmental delegation at an appropriate level of comfort and convenience. We, therefore, kindly suggest that the delegation stay in one of the hotels in Uyo, such as Le Meridien."

Vanguard learnt that the NCP and the BPE were upset with the response from RUSAL and could not proceed with the planned visit to the plant, while the expatriates flown in by BFIG, were left in a state of confusion and shock.

It was learnt last night that the expatriates were still inNigeriahoping to see an end to the ALSCON sale debacle.

S-Court ruling has nothing to do with us -RUSAL

However, RUSAL has remained defiant, saying that the Supreme Court ruling does not have anything to do with it or its stranglehold on the plant, which has led to a massive depletion of the assets of the company from N127 billion in 2004 to a paltry N19 billion in 2009, according to figures at the Corporate Affairs Commission, CAC, which Vanguard sighted last night.

The financial figures for 2010 and 2011 are not yet ready and the assets of the company could be much less going by the declining trend in recent years.

ALSCON explains court's verdict to staff

In a memo released to the staff of the company following the Supreme Court ruling, the managing Director of ALSCON, wrote to them clarifying the meaning of the court action, saying: "Dear employees of ALSCON, the management wishes to give further clarifications with regards to the ruling of the Supreme Court of Nigeria of July 6, 2012.

"Neither RUSAL nor ALSCON is a party to the lawsuit. The ruling ofNigeria's Supreme Court neither changes nor can change the ownership of ALSCON.

"ALSCON remains part of RUSAL and RUSAL's plans to develop and transform the plant into a cutting-edge and highly technological enterprises are in progress. RUSAL as a good faith purchaser of ALSCON is ready to protect its ownership even through litigation in theInternational Arbitration CourtinLondon.

"The situation around our plant has attracted attention at the highest governmental level. The Ministry of Foreign Affairs has approached the Nigerian Government with a request to undertake actions to prevent a potential damage to the existing fruitful and mutually advantageous relations betweenRussiaandNigeria, which might be caused by the current situation."

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