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FG terminates offer of purchase of ALSCON by BFI Group Corporation

By on March 19, 2013

The Bureau of Public Enterprises, BPE, on Tuesday announced the cancellation of the sale of the Aluminium Smelter Company of Nigeria to US-based BFI Group Corporation.

A statement by the Head of Public Communications, Chigbo Anichebe, confirmed the directive of the National Council on Privatisation (NCP) to terminate the offer to BFI Group Corporation for the purchase of 77.5 per cent.

The statement noted that the decision followed BFIG’s inability to pay the agreed 10 per cent of the offer price within the stipulated 15 working days of the execution of the Share/Sales Purchase Agreement as directed by the Supreme Court of Nigeria.

But BFIG’s Chairman, Reuben Jaja, argued that the cancellation of the sale was a violation of the July 6, 2012 supreme court order.

The Supreme Court had granted perpetual injunction, restraining any act by any agency of government against the contract until all the issues that resulted in the crisis are resolved.

Meanwhile, United Co. Rusal PLC, on Friday, suspended production at the ALSCON pending the outcome of its legal battle with BFI Group over ownership of the plant.

The Supreme Court in July revoked the 2007 sale of the ALSCON to Rusal, saying BFI Group was the highest bidder. It ordered BPE to complete the sale of the smelter to BFI Group.

Only a month ago, BFI Group said it had started the process to formally take over ALSCON.

However, Rusal says it remains the smelter’s rightful owner and had appealed to the London Court of International Arbitration.

The company assured that the “smelting operations will resume “as soon as the legal uncertainty has been resolved and the continuous power supply has been secured.”

“The on-going situation around the illegal attempts to challenge Rusal’s rights of ownership to the plant and the recent decision of the Supreme Court of Nigeria to cancel the sale of Alscon shares to Rusal impede long-term investment in the smelter,” it said.