This week’s pledge by the Minister of Mines & Steel Development, Kayode Fayemi, to work with a Russian firm to reactivate the Aluminium Smelting Company of Nigeria, ALSCON, in Ikot-Abasi, is in clear violation of a Supreme Court judgement, PREMIUM TIIMES can report.
The Supreme Court, Nigeria’s apex court, had on two separate occasions ordered that the company be taken away from the Russian firm, UC RUSAL.
On Wednesday, Mr. Fayemi’s aides distributed a statement indicating the minister’s visit to ALSCON and his pledge to work with UC RUSAL.
The Chairman/Chief Executive of BFIGroup, Reuben Jaja, who was reacting to Mr. Fayemi’s visit to the plant, said the minister’s action was not only illegal, but contemptuous of the Supreme Court, which has ruled twice, sacking the Russians from the company since 2012.
BFIG is the Nigerian-American consortium that was declared winner of the bid for ALSCON in 2004 by the National Council on Privatisation, NCP, but was later disqualified by the Bureau for Public Enterprises, BPE, in controversial circumstances, triggering a lingering ownership legal tussle.
After a tour of the plant and its adjoining harbour, Mr. Fayemi commended UC RUSAL, led by its managing director, Dimitriy Zaviyalov, for ensuring the “machines were kept in good shape, despite the absence of production activities, occasioned by a legal tussle over ownership.”
Although the minister said government could not do anything about the legal tussle, he assured the Russians that government would “encourage the Supreme Court to expedite action on the ruling, which would free the complex of any encumbrances,” an indication Mr. Fayemi is either ignorant of the Supreme Court rulings or has decided to ignore them.
The minister cleared the Russians of accusations of asset stripping, saying “contrary to reports that UC RUSAL was involved in asset stripping at ALSCON, the fact on ground showed the Russian group maintained the plants as well as a small work force, since it stopped work.”
“Government is fully prepared to tackle other administrative issues that crippled production processes at the plant once the legal aspect had been resolved.
“Specifically, the ministry is ready to assist the company in resolving all administrative issues with some organisations, including the Nigeria Export Processing Authority, NEPZA, the Nigerian Gas Company and the Bureau of Public Enterprise, BPE, in the bid to ensure the plant comes alive again.”
Although his action appears a clear violation of the Nigerian law, the minster restated the Buhari administration’s commitment to the rule of law.
“This is a government that believes in the rule of law. So, we cannot influence the judiciary over the matter. But we will help to resolve all other administrative issues that may arise between the company and other organisations in the interest of our economy,” he said.
“It is in our interest for the issues to be resolved. I am sure the Vice President, who is also the Chair of the Privatisation Council of Nigeria, would invite all the parties concerned once I brief him on my findings.
“We cannot have such a huge national asset like ALSCON and allow it to go into ruins. If privatisation must work, there must be sanctity of contractual agreement,” Mr. Fayemi said.
But in his reaction, Mr. Jaja faulted Mr. Fayemi’s stance on the ownership of ALSCON.
“The minister is being misguided to think the case against ownership of ALSCON is still at the Supreme Court,” Mr. Jaja said. “The minister should know the Supreme Court had ruled on the matter on two occasions, and the verdicts were very clear and unambiguous.
The businessman made reference to two Supreme Court judgements PREMIUM TIMES had reported about.
“On July 6, 2012, the Supreme Court in a unanimous verdict of 5 to 0, upheld BFIGroup’s legal right to acquire ALSCON and ordered BPE to comply. Again, on July 11, 2016, the Supreme Court rejected any arguments by BPE (Bureau for Public Enterprises) and UC RUSAL to vacate the judgment of 2012.
“So, for the minister to call for the Supreme Court to expedite action in the case now shows he is not up to date with the current information on ALSCON. If the minister believes in the rule of law, he should know that romancing with UC RUSAL on a matter the Supreme Court has already ruled twice is illegal and contemptuous. This a matter BFIG lawyers intend to take up with the minister,” Mr. Jaja said.
On the continued closure of the plant, Mr. Jaja said in line with Supreme Court ruling, the BPE was supposed to provide the share purchase agreement for BFIGroup to execute, pointing out that the privatization agency was yet to come forward with the already developed agreement, for signature.
On the minister’s comment that the plant’s assets were not stripped, Mr. Jaja said that against the value of ALSCON in 2004, put at about $1.3 billion by the accounting firm, KPMG, its value had dropped significantly to less than $120 million.
“What would be the minister’s explanation to this significant decline, if not the massive degradation of the plant by the company illegally entrusted with its management,” he said.
PREMIUM TIMES tried to reach Mr. Fayemi on why he appears to be ignoring the Supreme Court rulings on the matter. The minister did not pick or return calls, nor respond to a text message. His spokesperson, Yinka Oyebode, however, said his boss would await a letter by BFIG before making a statement.