The Bureau of Public Enterprises (BPE), the core investor that initially acquired the National Clearing and Forwarding Agency (NACFA), would have to pay outstanding N189m to Jorotom International Agency Limited, that later acquired 100 per cent of NACFA through a core investor sale strategy in 2006.
This follows a directive by the House of Representatives’ Committee on Privatisation and Commercialisation that has threatened zero allocation to the BPE in the 2022 budget or any other legislative engagements if the Bureau fails to make the payment, alleging that the Bureau had refused to answer its invitations several times over the dispute on NACFA properties.
According to Punch report, the committee also advised the Assets Management Company of Nigeria, Messrs Jorotom International Agency Limited, Ministry of Defence and other parties to settle their lingering disputes out of court.
The disputes are over the sealing off of the company’s property in Lagos and a piece of land on Plot GKN 204, Old Airport Road Kano, which is being occupied by the Nigerian Army for years. The land, which is 3.484 hectares, is part of the assets and liabilities inherited by the company after it acquired NACFA.
Jorotom International Agency Limited acquired 100 per cent of NACFA through a core investor sale strategy in 2006 at the sum of N3.6bn, which was financed through a loan facility granted by the defunct Skye Bank.
The bank was taken over by AMCON and transformed into Polaris Bank. Consequently, AMCON sealed off the company’s properties based on the loan facility and accruing interest, while its plot of land occupied by the military was not paid for by the Ministry of Defence. Subsequently, AMCON filed a case at the Federal High Court, which has been appealed up to the Supreme Court over the failure of the company to offset the debt.
At the investigative hearing held by the committee in Abuja on Tuesday, the General Manager, Jorotom International Agency Limited, the news owners of NACFA, Adeniyi Dare, said the property in Lagos was sealed off by AMCON leading to a loss of about 1,000 jobs. Dare also said the military had also been occupying the company’s property in Kano since 2006.
According to him, the Ministry of Defence showed interest in buying the land but the ministry undervalued the land in 2016. The GM said another revaluation was done for the property in 2020 for N32bn.
He recalled that when the Memorandum of Understanding on the acquisition of NACFA was signed, it was agreed that the BPE would reimburse the core investor with the sum of N189m as the cost of procuring and perfection of the title documents on behalf of bureau.
“However, this payment is yet to be made despite our demand letter of 2nd August, 2021, to the BPE. The delay in this payment has impacted negatively on our operations,” he stated.
In the same vein, the company in a letter to the Minister of Defence dated August 2, 2021, which was presented to the committee, said it was shocked to receive only N125m out of N2.2bn compensation, however, the Permanent Secretary, Ministry of Defence, Musa Istifanus, explained that the payment was delayed and paid in bits due to budgetary limitations.
Istifanus also stated that the ministry’s indebtedness to various property owners whose lands were acquired by the military and approvals granted by the Federal Ministry of Works and Housing for payment, ran into billions of naira.
“Due to lean budgetary allocation to the Ministry of Defence, the ministry is incapacitated in settling debts. The inability of the ministry to pay has led to series of litigations in the court by property owners.” He noted.
The Permanent Secretary, therefore, asked the House to consider an increase in the ministry’s budget to take care of the numerous compensations by the ministry.
For its part, AMCON has stated its position that its actions on NACFA properties were within the provisions of the law establishing the corporation.
AMCON’s Head of Litigation, Norbest Enenmoh, said it was after all attempts to recover the loans that the corporation took the necessary steps. A member of the committee, Uzoma Nkem-Abonta, however disagreed, saying that AMCON invested in Polaris Bank and became part owners of the loan.