Nigeria Content Online

The Bureau of
Public Enterprises (BPE) has reassured UnityKapital Assurance Plc that
the federal government’s plan to divest 24 percent of equity
stake-holding in Transcorp Hilton Hotel will not jeopardise its
investment interest in the company. UnityKapital’s former managing
director/chief executive officer, Mohammed Kari, had recently told
reporters that the move to offload 24 percent of government’s
shareholding in Transcorp to workers was coming on the heels of an
unresolved crisis relating to UnityKapital subsidiary, Capital Leisure
and Hospitality, to acquire 15 percent stake of the company.

According to Mr.
Kari, the investment interest, which was based on a Memorandum of
Understating (MoU) signed with a former Transcorp management at the
inception of the consortium, should have been one of the first
considerations by BPE before going ahead with the plan to sell more
shares to the public.

Agreement stays

But BPE, through
its spokesman, Chukwuma Nwokoh, pointed out that contrary to Mr. Kari’s
fears, the planned divestment of 24 percent of government’s equity in
the hotel would not affect any existing agreements among private
shareholders who control majority stake of 51 percent in the company.

“We are aware of
the comments credited to the immediate past managing director of the
company relating to ongoing plans to sell 24 percent of government’s
equity in Transcorp to workers. There is no basis for any fear, as the
exercise is going to affect only federal government’s shareholding
structure in the company, and not those of the private shareholders.

“BPE is not going
to do anything that would negatively affect the interest of any
stakeholder in the company. All existing memoranda of understanding
(MOU) would not be affected, as those are issues for the private
investors to handle. The exercise has nothing to do with former
arrangements between UnityKapital and their partners which, we learnt,
are about to be sorted out through arbitration,” Mr. Nwokoh explained.

Mr. Kari had said
the signing of the MOU by Transcorp and Capital Leisure followed the
evaluation of the latter’s chances, which was found to have been
brighter than other bidders’ interest in bidding for the hotel, adding
that Transcorp had approached the management of Capital Leisure to seek
its partnership in the bid process.

According to the
former UnityKapital boss, one of the terms of the signed MOU was that
Transcorp would provide funding for the bid and take over 51 percent
equity offered by government, which would thereafter be shared between
Transcorp and Capital Leisure on a 70:30 percent ratio respectively.
However, Mr. Kari pointed out that no sooner had Transcorp raised the
money and paid than it refused to honour the terms of the MOU,
resulting in the ongoing litigation in court.

He expressed his frustration that BPE failed to listen to the pleas
in its petitions and complaints demanding its intervention to help
resolve the matter, adding that the company had to resort to the court
when the management of Transcorp repeatedly failed to attend to its
request or even acknowledge many of its letters on the issue.