Indian steel giant, Global Holdings Ltd. is at daggers drawn with the Nigerian Minister of Justice and Attorney-General, Michael Aondoakaa over the inability of the former to deliver on a deal to convince President Umaru Yar’Adua to reverse the federal government’s cancellation of the concession granted the company on Ajaokuta Steel Company. Global Steel Holdings is asking Aondoakaa to either “deliver or refund the $6 million dollar bribe he received on the deal.”
Citing skew-ness in the transaction in favor of Global Steel Holdings (GSH) “to the detriment of the federal government (of Nigeria)”, Yar’Adua had on April 1, 2008 cancelled the concession granted the Indian steel company on Ajaokuta Steel Company by his predecessor, Olusegun Obasanjo, in 2004.
"Instead of investing external funds on the completion of both projects as expected, GIHL embarked on massive borrowing from local commercial banks, pledging the assets of Delta Steel as collateral…GSH owes Nigerian banks $192 million…President Yar'Adua has ordered the criminal prosecution of indicated officials and promoters of GSL for asset stripping," the Nigerian Presidency had declared.
Miffed by the development, GSH had filed a lawsuit at the International Court of Arbitration, Paris, challenging the Nigerian government's decision which it said came after it had invested over $500million in the steel plant. GSH also accused the Nigerian government of not giving it “promised support.”
“It was after GSH filed the lawsuit at the International Court of Arbitration that the Attorney General (Aondoakaa) approached the company to drop the lawsuit to enable him pursue a political solution through the First Lady (Mrs. Turai Yar’Adua),” a source told Pointblanknews.
According to the sources close to the Indian steel giant, “the AG pointedly told us the implications of the lawsuit, including the delays and the money we stood to lose if we continued on that track. He offered to speak to the First Lady on our behalf, to prevail on her husband to allow our company (GSH) to continue with the Ajaokuta concession.”
Pointblanknews.com gathered that, it was at this point that a meeting was scheduled between Aondooaka and officials of GSH for London, to coincide with Yar’Adua’s visit to the United Kingdom. During the President’s visit in July 2008, Aondooaka, the sourced disclosed, “instead of using the accommodation provided for by the Nigerian High Commission in the UK checked into the prestigious Hilton Hotel in Park Lane, London, paid for by Global Steel Holdings.” Aondooaka’s stay in the London, Park Lane Hilton, reportedly put an 18,000 Pound Sterling hole in the pockets of Global Steel Holdings.
It was at this 450-room Park Lane Hilton, stated the source, that Aondooaka sealed the deal with Sunil Kumar Manwati, President, Business Development of Global Steel Holdings to part with $6 million to “facilitate” the reversal of the revocation of the concession on Ajaokuta Steel Company.
Shortly after the London meeting, Manwati announced to the world that even though Global Steel had filed a lawsuit at the International Court of Arbitration challenging the Nigerian government's decision, “however, we are open to any talks with the government to resolve the issue.”
Pointblanknews gathered that the meeting with Aondoakaa may have also informed the optimism expressed late last year in far away India by Vinod Mittal, Managing Director of Ispat Industries, India’s seventh largest privately held company and promoters of Global Steel Holdings that “We are still talking to the government....”
“Aondoakaa had boasted to his Indian host that, ‘you will see that some of us are the owners of Nigeria.’ That GSH would be back to Ajaokuta in less than two months after fulfilling their own side of the bargain ($6 million bribe). It is now close to eight months after they gave Aondoakaa the $6 million, yet the Indians are nowhere close to repossessing Ajaokuta,” the source added.
Instead, Aondoakaa and Yar’adua are planning to resell the plant to another buyer. Aondoakaa is currently asking GSH to drop another $4 million.
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