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Jospong Group reacts to take-over of Akwatia mine

The Jospong Group of Companies (JGC) has responded to the government’s takeover of Great Consolidated Diamonds Ghana Limited (GCDGL).

It said the government, through the Divestiture Implementation Committee (DIC), had acted without following due process.
According to a statement released by the Jospong Group, the issue of the legality of the abrogation was before the law court and, therefore, it was wrong for the government to take over the company.

“The government, acting through the DIC, by a letter dated 9th April, 2019 purported to abrogate the agreement between the parties without following due process. GCDGL, through their lawyers, drew the attention of DIC’s lawyers to the illegality of the intended action of the DIC and proceeded to issue a writ of summons and an accompanying Statement of Claim to protect the interest of the company.

“It is, therefore, unfortunate that the government, after filing a Statement of Defence in the aforementioned suit, proceeded to take over the management of the company without recourse to the law and the tenets of good governance,” it said.

Take legal action

The statement said the group would seek legal redress over what it described as an “illegal takeover”.

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“As a responsible company, we reiterate the fact that the matter is presently before a court of competent jurisdiction and we will, therefore, wait for the final determination of the matter,”it added.

Government takeover

Last Friday, the government announced the abrogation of the contract awarded to GCDGL in 2011 to mine diamonds at Akwatia for breach of contract.

The company, the government said, failed to fulfil its core mandate of paying $17 million to the DIC, as well as rehabilitating and refurbishing facilities at the mines to enhance production.

A nine-member interim management committee (IMC) has been formed, with Mr Samuel Bonsu Attakorah, a former employee of the erstwhile Ghana Consolidated Diamonds (GCD), as the acting Managing Director, to oversee the operations of the mines, while the government looks for a competent investor to take over the operations.

The Director-General of the State Interest and Governance Authority (SIGA), Mr Stephen Asamoah-Boateng, announced the takeover at an emergency meeting with the IMC, the management of the GCDGL and some members of the community at Akwatia after touring the company.

We have made efforts

The statement from the Jospong Group, however, refuted the government’s claims and said since the group took over the mines in 2011, it had made serious efforts to make it commercially viable.

“The JGC took ownership of the GCDGL from the government’s Divestiture Implementation Committee in 2011. At the time of acquisition, the company had been closed down, with its premises in a dilapidated state, with obsolete machinery and equipment.

“Following the acquisition of the mine, the GCDGL and the JGC have made several attempts to make the mine commercially viable, albeit not yet entirely successful. This led to a series of communications with the DIC, with the aim of reaching a mutually satisfactory direction on how to proceed with same,” it added.

The statement said the GCDGL had, since the acquisition, made payments on account, and through its principal shareholder had been in dialogue with the government with the aim of settling the outstanding liability by way of a set-off from government’s liability to the shareholder.

The government was yet to respond to that proposal, despite repeated overtures, it said.

On the refurbishment of the Akwatia Mine and hospital, the statement said since the acquisition of the mine, millions of dollars had been invested in the mine which had been completely run down at the time of acquisition.

“In the development plan to revive the mine to full-scale operations, we have undertaken numerous feasibility studies and development activities amounting to over 20 million USD. The GCDGL and its strategic partners have reached an advanced stage to execute a 50 million USD investment to operationalise the mine, of which a memorandum of understanding has been signed,” it said.

Jospong described the action of SIGA as “illegal, unconstitutional and regrettable in a nation that is governed by the tenets of democracy,” saying that the closure of the company created pandemonium “in the rather peaceful community and deprived the community of the very livelihood the facility had given them over these few years”.

 

Source:Graphic.com

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