The Director General of the Bureau for Public Enterprises, Ayodeji Gbeleyi, on Friday, revealed that Delta Steel Company, valued at over $700m, was sold for $30m.
Gbeleyi stated this while interfacing with the House of Representatives Committee on Public Assets in Abuja.
“A company worth $700m was sold for just $30m,” he said, noting that under the Federal Government’s privatisation policy, “80 per cent of Delta Steel Company in Aladja, Delta State, was sold to Global Infrastructure Nigeria Ltd in 2005, while the government retained a 20 per cent stake.”
He explained that residential buildings and land owned by the company were used to settle workers and pensioners.
After privatisation, the company reportedly used Delta Steel Company’s assets as collateral for a loan from Ecobank.
The BPE DG further revealed that due to non-performance, the Asset Management Corporation of Nigeria acquired the assets in 2015 and sold them to Premium Steel and Mines Ltd.
He accused AMCON of failing to seek clarification from BPE before selling the assets, stressing that while BPE was aware of the loan from Ecobank, it had no knowledge of three other banks listed by AMCON as creditors.
The petitioners, including the Association of Concerned Residents of Camp 2, 4 and 5 of Delta Steel Company, Aladja, Warri, before the involvement of AMCON and Premium Steel and Mines in DSC assets, had been staying in the estate and plots of land which were used to settle them in line with contractual agreement.
The petitioners claimed that they have been under constant intimidation and harassment by police and Army personnel since 2015, claiming to be acting on the instructions from AMCON and Premium Steel and Mines to vacate the estates.
Speaking on behalf of the petitioners, Dr David Emomotimi and Richardson Osifor, said the assets AMCON acquired were assets used as collateral by Global Infrastructure Nigeria Ltd to obtain a loan 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 N250m but AMCOM jacked it up to N7bn.
In their submission, the representatives of AMCON, Chukwuemeka Umunakwu (AMCON legal unit), said AMCON acquired the assets of DSC used as collateral to obtain loans from four banks to prevent them from collapsing.
He said AMCON acquired the assets at N22bn but sold it to Premium Steel and Mines at N32bn.
Responding to the inquiry by the committee whether the Office of the Accountant General of the Federation has the receipt of payments by both BPE and AMCON in respect of sales of Delta Steel Company’s assets, the representative of AGF, Kabiru Ademola (Director, Finance) acknowledged receipt of N3bn in favour of BPE in respect of sales of 80 per cent of DSC assets to Global Infrastructure Nigeria Ltd.
He stated that the AGF is yet to get any response from Central Bank of Nigeria regarding claim of payment of N32bn by AMCON in respect of DSC assets to Premium Steel and Mines Ltd.
