Business News of Thursday, 16 March 2017
The Member of Parliament for Okaikoi Central, Patrick Yaw Boamah has called on government to conduct a forensic investigation into the activities of the Meridian Ports Services Limited (MPS) in Ghana.
MPS is a subsidiary of the MPH consortium, which has multinational companies AP Moller (Maersk Group) and Bollore, the biggest users of Tema Port as majority shareholders.
It also has a company Sutton Energy Limited (SEL), owned by Ghanaians as minority shareholder.
The company was set up to help government raise adequate revenue at the Tema Port.
However, the shareholding structure was diluted in 2009 against the minority shareholders and Government of Ghana, leading to threats of legal action.
Consequently, the MP for Okaikoi Central, Patrick Boamah is urging government to probe the activities of the company without delay.
“I believe it’s an urgent matter that requires public scrutiny and I believe the government will take the necessary steps to ensure that the right shareholdings, the right values that government has to drive are respected.
“We are also asking government to protect the interest of the minority rights in the MPS structure and I believe some of the shareholders have hinted going to court and I don’t want Ghana to be saddled with legal disputes,” the MP stated.
According to him, Ghana government was also given a stake in the MPS structure but shareholding has been diluted.
“My information is that the shares of Government of Ghana have been diluted and I want the government of the day to take the necessary steps to call for thorough forensic investigations into the circumstances to the dilution of the shares of Ghana in MPS.
“Government must find out whether the government at the time took the right decision, put its right foot forward in ensuring that the government of the day was able to raise its equity stake to be able to hold on to the shareholding of government at the time.
“I believe is a prosperous venture and the shareholding of government, looking at the revenues that come into the port, will help the government achieve its objective under the Akufo-Addo administration,” he noted.
Two Ghanaian countrymen Mr. Kojo Annan and Mr. Michael Wilson initiated and enabled a port operation project in their home country of Ghana but have been denied the chance to participate in its success due to egregious and unfair conduct from the majority shareholders.
Mr Annan and Mr Wilson first approached the Ghana Government in 1999 with an idea of rationalising the operation and management of Tema Port. Between 1999 and 2002 they discussed and refined the project with the highest officials of the Ghanaian Government. This was the beginning of what later became the MPH consortium which operates the port of Tema in Ghana through its subsidiary Meridian Port Services Ltd (MPS).
Upon the then President of Ghana’s request, the MPH consortium included the multinational companies AP Moller (Maersk Group) and Bollore the biggest users of Tema Port. They became the majority shareholders from the outset and Mr Annan and Mr Wilson, through their company Sutton Energy Limited (SEL) the minority shareholder with a 6.75% interest in MPH.
In October 2002 the Minister of Road and Transport for Ghana announced the formation of the MPH consortium and the plans for the fast track development and management of the container terminal in Tema. SEL was a part of this public announcement and listed as a shareholder.
There is no disputing the role Sutton (SEL) played in creating the project and getting it off the ground after over 6 years of development work. As co shareholders of such a lucrative opportunity they expected to be treated with appropriate co-operation, fairness and good faith at all times. Unfortunately, the opposite has been the case and through manifest breaches of the shareholders’ agreement they have been disregarded, marginalised and the majority owners have all but removed SEL from the project.
In late 2009 MPH passed an unlawful share issue that resulted in a devastating drop in SEL shareholding from 6.5% to 0.0093%.
They have also failed to pay SEL any dividends throughout this period and refused to act in good faith with SEL in relation to its status as a co-shareholder.
In financial terms the unlawful conduct rendered the value of Sutton’s shares to drop from a conservative valuation of around $15m in 2009 to a purely nominal sum.
The valuation of the said shares will be significantly higher today in 2017 not to talk of the further 8 years remaining on the current concession agreement and the additional 30 year extension recently granted to MPS.
Our demand is for Sutton to be restored to its rightful position in which it would have been as a shareholder had it been provided with the opportunity to take part in the share issue and exercised its right.
The majority shareholders of MPH are claiming that they provided due notice of the rights issue by sending letters of notification to the addresses provided by Sutton in the shareholders’ agreement. Even though those letters were returned to sender and confirmed as undelivered, they claim that legally they have fulfilled their obligations.
Sutton counters this with clear evidence of lack of good faith or reasonable business ethics. No attempt to communicate via email, telephone etc even though all previous correspondence of the past seven years had been done in this manner.
Furthermore, Ghana being a fairly small community any reasonable efforts to find Messrs Annan or Wilson would have resulted in them being easily contacted within 24-48 hours wherever in the world they were.
As an example, the company secretary of MPS from inception and up until today is a paternal first cousin of Kojo Annan and also had the power of attorney to sign for and on behalf of Sutton.
Kindly note, the aforementioned is a summation for information purposes. We have hundreds of pages of documents, emails, shareholders agreements, concession agreements etc to back up all claims.
There is also a full 55 page legal statement of claims now filed.
The matter is currently in international arbitration in London as MPH is registered at companies house U.K. In this case SEL is being represented by Mrs. Cherie Blair, QC.??