The House of Representatives Committee on Public Assets has launched an investigation into the controversial sale and collapse of the Delta Steel Company (DSC), Aladja, Warri in Delta State. The committee, led by Hon. Ademorin Kuye, is questioning key government agencies over how a company worth over $700 million was allegedly sold for less than $30 million.
How Did a $700 Million Asset Sell for $30 Million?
According to the Director-General of the Bureau of Public Enterprises (BPE), Mr. Ayodeji Ariyo Gbeleyi, the Federal Government privatized the steel company in 2005 by selling 80% of its shares to Global Infrastructure Nigeria Ltd (GINL) for $30 million, while the government retained 20%.
However, Gbeleyi explained that after acquiring DSC, GINL used its assets as collateral to secure a loan from Ecobank. When the company failed to repay the loan, the Asset Management Corporation of Nigeria (AMCON) took over the assets in 2015 and later sold them to Premium Steel and Mines Ltd.
The committee is now scrutinizing the entire transaction, with Kuye stating, “We are here to ensure that public assets are properly managed and not disposed of under questionable circumstances.”
Residents Complain of Harassment
A major concern raised during the hearing was the fate of workers and pensioners who had been allocated residential buildings and plots of land from DSC. Petitioners, including the Association of Concerned Residents of Camp 2, 4, and 5 of Delta Steel Company, alleged that since 2015, they have faced constant intimidation from security operatives, who claim to be acting on behalf of AMCON and Premium Steel.
Speaking on behalf of the affected residents, Dr. David Emomotimi and Richardson Osifor insisted that the assets AMCON acquired were those used as collateral for the Ecobank loan, which did not include their residential buildings.
Osifor also raised concerns about the financial transactions involved, stating, “The loan Global Infrastructure Nigeria Ltd obtained from Ecobank was N250 million, but AMCON increased it to N7 billion.”
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Discrepancies in Financial Records
During the hearing, the representatives from AMCON claimed they had taken control of DSC to prevent its complete collapse. Chukwuemeka Umunakwu, from AMCON’s legal unit, stated that the agency acquired DSC assets for N22 billion and later sold them to Premium Steel and Mines for N32 billion.
However, the Office of the Accountant General of the Federation (AGF) raised doubts about AMCON’s claims. Kabiru Ademola, a director at the AGF’s office, confirmed that the office had received N3 billion from BPE for the sale of 80% of DSC assets to Global Infrastructure Nigeria Ltd. However, he noted that there was no confirmation from the Central Bank regarding AMCON’s alleged payment of N32 billion for the assets.
“AMCON claims the money was paid into the federal government’s Treasury Single Account (TSA), but they have not provided any proof,” Ademola told the committee.
MOFI Backs Out Due to Controversy
The Managing Director of the Ministry of Finance Incorporated (MOFI), Dr. Armstrong Takang, expressed deep concern over the mismanagement of Delta Steel Company and similar public enterprises.
“If our forefathers, who were less educated and exposed, could build such infrastructure, why is it a problem for today’s leaders to maintain them? What does this say about the future of our country?” Takang questioned.
He further revealed that MOFI had withdrawn from involvement in the DSC case due to the numerous controversies surrounding it.
Reps Issue Directives
As the investigation continues, the House of Representatives Committee on Public Assets has directed AMCON and Premium Steel and Mines to immediately stop harassing the residents of the DSC estate. The committee has vowed to get to the bottom of the matter and ensure that public assets are not mismanaged or sold under suspicious conditions.
With more revelations expected in the coming days, Nigerians are watching closely to see if those responsible for the alleged undervaluation of Delta Steel Company will be held accountable.