The Social Security and National Insurance Trust (SSNIT) has clarified that the sale of a 60 percent stake four of its Hotels to Rock City has not been concluded.
The others are Labadi Beach Hotel, the Ridge Royal Hotel, Elmina Beach Resort, and the La Palm Royal Beach Hotel.
Director General Mr. Kofi Osafo-Maafo said negotiations with Rock City were still ongoing.
He revealed that SSNIT has not agreed to the payment terms with Rock City.
Addressing a press conference on July 8, 2024, he explained that the negotiations have stalled because there are major challenges regarding the payment terms of the deal.
The sale of a 60 percent stake in the four hotels of SSNIT has generated a debate and public uproar after Member of Parliament for North Tongu, Okudzeto Ablakwa, raised issues about the sale and filed a petition with CHRAJ accordingly.
The Director General said they have responded appropriately to CHRAJ on the matter.
He debunked the allegations of state capture, nepotism, and corruption in the transaction, stressing that due process regarding the process was duly followed to arrive at the stage of the negotiations so far.
His response comes in the wake of several claims that the decision to partner with an investor to raise capital to invest in their hotels and also assist in their management was not transparent.
He maintained that the process started as far back as 2018 through International Competitive Tendering (ICT) processes as prescribed by the Public Procurement Act.
He reiterated that based on the criteria set out in the RFP, Rock City Hotel submitted the best and strongest technical and financial proposal amongst those received.
“The process was open, it was fair, and it was an international competitive tender. We could not have determined the outcome beforehand. So I am not exactly sure why you expect the company that won to drop out. Currently, what you are talking about is not a consideration,” he said in response to a question if Rock City will could be dropped and the next strategic investor awarded the sale.
“We haven’t sold the hotels. I dare emphasise. We are in the process of negotiating. There is no predetermined outcome. Once we engage stakeholders, and we also engage our board, and the bid is seen as sufficient, we will proceed. If it is not, we won’t proceed.”
He added that selling the shares to the strategic partner was the best decision because they were not making profits.
“We’ve been through quite a lengthy process to do so. Bear in mind, we’ve also tried having external management companies running the SSNIT hotels and that hasn’t resolved the problem either.
“So, for us, we look at it twofold, that we are looking to resolve a problem and do so with the introduction of a strategic investor and we outlined the reasons there.”
“Consistent losses by almost all of our hotels. I know you are aware that Labadi doesn’t make a profit, but the returns are below [par]. They haven’t paid us any dividends with the exception of Labadi. Labadi Beach Resort only started paying dividends for the last 2 years. They haven’t from inception,” he stated.
“We want to maximize what we get out of it and the question that I asked somebody the other day is if you were selling your car or even your house, if you were selling your house, you’d make an attempt to actually paint it.
“You wouldn’t wait for your car to be put on stones and then say, now this is the time to sell it. You make it look good. There’s no reason why if a business is doing well and we seek to maximise capital from its to invest elsewhere, we shouldn’t do so.”
“The reason is simple. Returns are lower than we believe they should be, but also cash always has alternative uses. So why not? There’s a good investment rationale for that,” he stated.
By: Rainbowradioonline.com/Ghana
