The Nation Newspaper

Tag: ALSCON

  • ALSCON is bankrupt, says KPMG

    ALSCON is bankrupt, says KPMG

    • EFCC may intervene

     

    The Aluminum Smelter Company of Nigeria  (ALSCON) is bankrupt, an audit by KPMG has revealed.

    Details of the report made available to The Nation put the value of ALSCON as at December 31, 2011 at $89.9 million, whereas the company has accumulated a debt in excess of $135 million, or N22 billion.

    According to the report, entitled: Aluminum Smelter Company of Nigeria Plc Financial Statements – December 31, 2011 together with directors’ and auditor’s reports, under current liabilities, said ALSCON received a short term loan of N21.348billion in 2011.

    The report noted that the short term loans of N18,173,266,000 were given to DAYSON Holdings Limited;RUAL Limited N2,719,758,000 and SEA CHAIKA Corporation, N455,323,000, totalling N21,348,347,000.

    According to the report, “the loan agreements provide that the loans shall bear no interest, except where the company fails to fully repay the loan at the maturity date, in which case the company would be obliged to pay interest on the outstanding amount of the loan at the rate of two per cent per annul.”

    It further revealed that the movement in the loan balances during the year showed that N17.513billion was the balance at the beginning of the year, while N3.042billion was the amount of loan drawn down during the year. There was no repayment of the loan during the year and there was an exchange difference of N792,348,347,000, totalling N21,348,347,000.

    The President of BFIGroup, Dr. Reuben Jaja, confirmed that ALSCON was, indeed, bankrupt. He said BFIG had also seen the audit and the N21.3 billion short term loan that was in the books of the company.

    Dr. Jaja said BFIG will invite the Economic and Financial Crimes Commission (EFCC) to investigate what led to the insolvency of ALSCON, and what the money was used for. He wondered what the loan could have been used for since there were neither machinery upgrades, nor acquisition of new machines.

    He lamented that ALSCON has only N94.5 million as cash in the bank and at hand as at the time of the audit. Jaja said he was worried that the condition of the company might be worse, two years after the audit.

    He expressed dismay that the Bureau of Public Enterprises (BPE), which has a seat on the board of ALSCON, should have been aware of this indebtedness before offering to sell the firm to BFIG for $450 million.

    BFIG, he said, would also invite the EFCC to investigate what RUSSAL had done with the $120 million credit the Federal Government extended to the Russians for the dredging of the Opobo/Imo River estuary since 2004.

    He alleged that to claim the $120million credit the Federal Government promised it for the dredging of the Imo River, RUSSAL brought Autonomous Non-Profit Organisation Marine Technologies and Safety from Russia to claim the money.

    The BFIG president reiterated that “the BPE’s claims that BFIG did not make the payments for ALSCON and also failed to sign the Share Purchase Agreement (SPA) are false.”

    He said the group had signed the mutually agreed SPA which was prepared and delivered to it by the BPE and the group in turn hand delivered the signed SPA to the privatisation agency with five days to spare and also requested for the BPE’s bank details so that it could make the initial payments but that the BPE refused to release it’s bank details.

  • ALSCON workers protest unpaid benefits

    ALSCON workers protest unpaid benefits

    WORKERS at Aluminium Smelter Company, UC RUSAL, yesterday protested the non-payment of terminal benefits to disengaged workers.

    The workers flayed the decision of the management to pay casual/contract workers who have been in their employ for six years and above N2,000 as terminal benefits.

    The protesters displayed placards with various inscriptions, such as: “Our land, our ALSCON, we can’t stay at home while strangers are working; RUSAL: Retain all indigenes or quit! “No indigene, no Russian, no ALSCON. Close down and go; RUSAL activities are strange, and No more land for farming in Ikpa Ibekwe clan. We must work in ALSCON.”

    Speaking on behalf of the workers, ALSCON’s branch Chairman of the Steel and Engineering Workers Union of Nigeria (SEWUN), Linus Usen, said that the union was not pleased with the company’s management in downsising without paying workers their terminal benefits.

  • NCP terminates firm’s offer for ALSCON

    NCP terminates firm’s offer for ALSCON

    The National Council on Privatisation (NCP) has approved the termination of offer put forward by BFI Group Corporation to purchase 77.5 per cent of Aluminum Smelter Company of Nigeria (ALSCON).

    Notice of the offer termination is contained in a statement signed by the NCP Head of Public Communications, Mr. Chigbo Anichebe, on Tuesday in Abuja.

    The statement noted that the termination followed BFI Group Corporation’s inability to pay the agreed 10 per cent of the offer price as directed by the Supreme Court of Nigeria.

    The Supreme Court had directed that the 10 per cent be paid within 15 working days of the execution of the Share/Sales Purchase Agreement (SPA).

    “The deadline for the execution of the SPA and payment of the 10 per cent of the offer price elapsed at midnight Nigerian time on March 18.

    “As at that deadline date, BFI Group had neither executed the SPA nor made the initial mandatory 10 per cent of the bid amount,’’ the News Agency of Nigeria quoted the NCP as saying in the statement.

    It recalled that the Supreme Court of Nigeria in a judgment on July 6, 2012 awarded ALSCON, located in Ikot-Abasi, Akwa-Ibom, to BFI Group Corporation.

  • BFI Group gets BPE offer letter on ALSCON

    BFI Group Corporation has received an offer letter and Share Purchase Agreement (SPA) from the Bureau of Public Enterprises in respect of Aluminium Smelter Company of Nigeria (ALSCON).

    In a statement, BPE said the offer is in compliance with the Supreme Court judgment of July 6, 2012 as well as the directive of the National Council on Privatisation (NCP), which met at the Presidential Villa, Abuja on January 22, 2013.

    BFIG, the plaintiff in the suit at the Supreme Court, is expected to execute the SPA and pay the agreed 10 per cent of the offer price of $410 million (which is $41 million) within 15 days of the execution of the SPA.

    The statement recalled that the court had stated among other averments that “an order of specific performance is hereby decreed mandating the respondent to provide the mutually agreed share purchase agreement for execution by the parties.

    That it said, will enable the plaintiff pay the agreed 10 per cent of the accepted bid price of $410 million (i.e, the sum of $41 million) within 15 working days from the date of the execution of the Share Purchase Agreement in accordance with agreement dated 20/5/2004 and the 90 per cent balance of bid price shall be paid within 90 calendar days.

     

     

     

     

     

  • ‘How ALSCON was sold’

    ‘How ALSCON was sold’

    Fresh facts have emerged over the circumstances surrounding the shoddy privatisation of Aluminum Smelter Company of Nigeria (ALSCON) at Ikot Abasi, Akwa Ibom State.

    Mr Nicholai Nicoshelivy, it was alleged, single-handedly endorsed the share purchase agreement (SPA) of the aluminum smeltering firm with the Bureau of Public Enterprises (BPE), although he had no authority to do so.

    Dr Reuben Jaja, Chairman of BFI Group, the consortium that was declared winner of ALSCON by the Supreme Court told The Nation that Nicholai alone signed the SPA with the BPE under fraudulent circumstances.

    He said: “When we pressed Nicholai in the US court, he testified under oath and submitted written document that he had no such power or authority to sign that document. In other words, the agreement is null and void.

    “He has realised that he has committed a fraud against Nigeria. He is not going to come to Nigeria if the judge transfers our case from New York to Nigeria.”

    According to Jaja, the company that bought ALSCON is known as Daison Holdings Limited and it is registered in the British Virgin Island. It is the only name on the SPA between Nigeria and RUSAL, adding that there is nothing about RUSAL in the document.

    “If you want to enforce anything on ALSCON, it will be against Daison Holdings Limited. We sued them all in the USA (Daison, RUSAL all of them). We forced them to come and tell the world who they are. Daison came and they have only Mr John Martin Parker as the sole director with no overlap of board or management position with RUSAL,” the BGI Group boss said. The company has no ownership interest with RUSAL. RUSAL, he said, also denied this and fraudulently described Daison as an indirect subsidiary of an unknown company.

    Jaja said three Nigerians identified as a former security topshot, the son of a former military head of state and another son of a civilian president, colluded with Daison to perpetrate the fraud.

    “They all hid behind Daison, so John Martin Parker is like a trustee of a blind trust and the Daison Holding is a commonwealth trust registered in Totola British Virgin Islands,” he explained.

    He said as a result of this development, BFIG has requested to be joined in the case at the International Court of Arbitration. “We will reveal that there is no valid contract. They illegally occupied the plant and ran the plant down thereafter, the EFCC (Economic and Financial Crimes Commission) will take over the case because it’s an absolute crime against the nation,” he said.

    Jaja noted that before BFIG went to court, “RUSAL made sure that the share purchase agreement specifically made mention of us that if we should come after them, the Federal Government of Nigeria will pay.”

    RUSAL has threatened to go to the International Court of Arbitration demanding that Nigeria pays $500 million when its audited financial statement says that the plant it got for a value of N127 billion is worth N14 billion.

    Speaking as a leading Niger Delta figure, Jaja disclosed that following government’s inability to execute the Supreme Court order instructing the government and the BFIG to adopt a mutually agreed share purchase document with the government collecting 10 per cent of whatever is the agreed price of the plant, the Niger Delta people have vowed to resist any disobedience to the country’s rule of law by a foreign business interest.

    Jaja said the involvement of the Niger Delta region in the ALSCON saga “is the struggle of the Niger Delta people, my great grand father was a pioneer of the struggle in the region, King Jaja of Opobo.”

     

     

     

     

     

     

     

     

  • ‘ALSCON’s asset devalued by 90%’

    The total asset base of Aluminium Smelter Company of Nigeria (ALSCON), Ikot Abasi in Akwa Ibom State has been devalued by 89.47 per cent since 2006, a report from its auditors has revealed.

    The company prior to being sold to the Russian firm, UC Rusal, had a total asset base of $3.2billion, but the summary of the company’s financial statement since 2006 has revealed that over 89 per cent of the company’s assets, have been devalued.

    A certified true copy of the audit report by the audit firm of KPMG obtained from the Corporate Affairs Commission, CAC, showed that from N30.98 billion in 2007, the company’s net asset value dropped to N25.2 billion in 2008; N19.4 billion in 2009 and N14.9 billion in N2010. The report for 2011 is yet to be published.

    The audit report suggested that the company’s asset base suffered massive devaluation by over N101.2 billion within a year of the take-over of the plant by UC Rusal.

    Ownership of the plant was transferred by the Bureau of Public for Enterprises (BPE) to the Russian firm, UC Rusal, in controversial circumstances in 2006 following the annulment of the bid won by the American-Nigerian consortium, BFIGroup Corporation in 2004.

    Prior to the bid, the company’s fixed asset as at December 31, 2003 stood at about N127.7 billion,while the figure dropped marginally to N127.3 billion at the beginning of 2004, according to  a report published by the audit firm, Pricewatercoopers Limited.