EFCC Chairman Waziri
Oct 16, 2011 – As part of the ongoing probe of the concession of Ajaokuta and Delta Steel firms, the Economic and Financial Crimes Commission has arrested four senior officials of Global Infrastructure Nigeria Limited (GINL).
Those detained are Managing Director (Joint), Dr. Sam N; Executive Director Operations, Sunil Bhandari; General Manager, Finance, Mukesh Agrawal; and Manager, Finance, Suhri Barve.
All the four officials, who have been detained, are presently undergoing interrogation.
Investigation by our correspondent revealed that the EFCC is probing how Delta Steel Company which was acquired on May 5, 2005 by Global Steel Holdings Limited and its subsidiary, GINL, incurred domestic debts of over N25billion. The firm is now under the receivership of UBA and ECOBANK.
According to findings, the EFCC had received a petition from one S.G. Kekere –Akpe on behalf of R.O. Egwere and O.J. Okari (representing disengaged staff of Delta Steel Company Limited).
The petitioners had isolated the following allegations against GINL for investigation by the EFCC.
· Alleged violation of terms of acquisition of Delta Steel Company Limited
· Case of conspiracy, economic sabotage, and tax evasion
· Diversion of public funds and money laundering.
· Alleged use of N182.168b assets and debentures of Delta Steel Company Limited as security to raise funds for Ajaokuta Steel Company Limited.
It was learnt that the weighty nature of the allegations in the petition, which was copied the Presidency, made the federal government to take more than a passing interest in the affairs of the two steel firms.
A top source gave insight into why the suspects have been detained over the two steel firms.
The source said: “We received petitions that the terms for the acquisition of the steel firms, expected to provide more than one million jobs, have been breached.
“The fact of the matter is that the GINL acquired substantial interest in Ajaokuta Steel Company Limited; Nigeria Iron Ore Mining Company Limited and Delta Steel Company Limited.
“By an agreement dated August 13, 2004, the Federal Government granted a concession for the rehabilitation, completion and commissioning of Ajaokuta Steel Company Limited for a period of 10 years to GINL and GSHL with a clause that the companies will provide 100 per cent financing
“On February 17, 2005, GSHL through its subsidiary (GINL) obtained concession on NIOMCO for 10 years.
“Also on May 5, 2005, the Bureau of Public Enterprises sold 176 million ordinary shares, representing 80 per cent of the Federal Government of Nigeria’s share in Delta Steel Company Limited to GSHL and GINL.”
The source claimed that the Federal Government became worried when GINL which declared N940, 222 million in 2005 and N9.735billion in 2006 at Delta Steel Company Limited had become indebted to some banks to the tune of about N25billion in 2008.
It was gathered that out of the debts, GINL owed UBA N2, 042, 595.540.19 and $7.391m as at December 30, 2008.
A senior government official said: “The government is worried that contrary to strict adherence to the post-acquisition programme of the Federal Government to revive the company by injecting Direct Foreign Investment and money, the suspects allegedly engaged in obtaining domestic loans from commercial banks resulting in the Delta Steel Company Limited’s indebtedness to the sum of over N25billion.
“The same company privatized for efficiency is now under receivership. To compound the problem, it was discovered that in an effort to fulfill its obligation of 100 per cent financing of Ajaokuta Steel Company Limited, GSHL served as guarantor to GINL and used all assets and debentures of Delta Steel Company Limited of about N182.168b as security for the securing of various facilities.”
But another source close to GINL said: “There is a case in a court in the UK over the breakdown of concession agreement on the two firms between the Federal Government and GSHL/ GINL.
“We think the EFCC will await the decision of the UK court. The case has also assumed a diplomatic dimension because the Indian promoter of GSHL, Pramod Mittal is the younger sibling of a steel tycoon, L.M. Mittal and head of Global Steel Holdings Limited.
“The family has a reputation of reviving steel firms in the world. It is not a fraudulent family. I think something went wrong with the concession agreement.”
The Head of Media and Publicity of the EFCC, Mr. Femi Babafemi, said: “It is true we arrested some officials of GINL but investigation is on.”
He refused to be drawn into any argument on the status of investigation, saying “At the appropriate time, you will hear from the commission on what our investigation has revealed.” (the nation)