Kogi State government and Dangote Industries slug it out over ownership of Obajana Cement plant

GOVERNOR Yahaya Bello of Kogi State presented documents to the federal government which disputes the ownership of the Obajana Cement Company by Dangote Industries and claims that the facility belongs to the state government.

Presenting the documents to the federal government on behalf of Kogi State, Folashade Ayoade, the secretary to the state government, said the claimed transfer of the Obajana cement plant to Dangote Industries was invalid, null and void. Obajana Cement Company is Dangote Industries flagship cement plant and the largest of its three factories in Nigeria with a combined capacity of 16.25m tonnes.

However, the Kogi State government is disputing the circumstances under which the plant  was sold to Dangote Industries as part of the federal government's privatisation programme. Governor Bello has said, however, that the  Kogi State government will be ready to enter into negotiations once the Dangote  Group admits that the Obajana Cement plant does not belong to it.

Documents submitted by the Kogi State government are from the report of the Specialised Technical Committee on the Evaluation of the Legality of the Alleged Acquisition of Obajana Cement Company Plc by Dangote Cement Company Limited. Mrs Ayoade said in the report that three certificates of occupancy for Obajana Cement Company, which was solely owned by the Kogi State government at the time, were used to obtain a loan of N63bn by Dangote Industries.

She said the committee, in view of its findings, had recommended that Kogi State take steps to recover the Obajana Cement Company from the Dangote Group. Her committee also recommended that the Kogi State government should take steps to recover all accrued dividends from profits made over the years, including accrued interest on the same.

Mrs Ayoade said: “Agreement between Kogi State government of Nigeria and Dangote Industries Limited, dated 30th July 2002 and supplemental agreement dated 14th February 2003, as contained in Exhibit 71 of the Judicial Commission of Inquiry Report, purporting the transfer of Obajana Cement Company Plc to Dangote Industries Limited, are all invalid, null and void. There is no evidence of consideration paid by Dangote Industries Limited to Kogi State government from the alleged transfer of Obajana Cement Company Plc and no dividend was paid to the state from the profits realised from the inception of Dangote Cement Company Plc to date.”

Hon Matthew Kolawole, the speaker of the Kogi State House of Assembly, said the acquisition of the Obajana Cement Company by Dangote Industries was without the resolution of the assembly, which rendered the process null and void. He said the transfer of the assets by a previous state government was thus illegal.

“It is clear that you cannot sell a state government property of any form without the resolution of the Kogi State House of Assembly. All the transfer process of the share capital to Dangote from Obajana by the previous administration was without any law backing it by the state House of Assembly,” Hon Kolawole added.

With the dispute getting heated,, the Manufacturers Association of Nigeria has condemned the recent invasion of the Dangote plant by Kogi State government officials. Reacting to the face-off between the state security outfit and workers at the Dangote plant on Wednesday, the association described the invasion as illegal and a breach of the fundamental human rights of one of Nigeria’s foremost corporate entities.