Ghanaian government mulls take-over of starch Factory from Jospong Company

GHANA – The Government of Ghana has unveiled plans of taking over the Ayensu Starch Company (ASCO) in a bid to revamp its operations, reports GhanaWeb.

According to Alan John Kyeremanten, Trade and Industry Minister, the move is as a result of failure on the part of shareholding company, Tiberias Company, to make further payment of its US$4.45 million obligation as the Purchaser.

The Government, in August 2016 made an offer to Tiberias Company Limited, a company affiliated to the Jospong Group to acquire 70% of its shares in the Starch Company.

According to a report by GhanaWeb, Tiberias Company accepted the offer and made an initial payment of U$2.26 million, representing 51% of the US$4,450,000 obligation but has since then made no further payments.

“The Company failed or refused to fulfil its obligations under the agreement and has defaulted on all other revised payment schedules,” Alan said.

Additionally Alan said that move will also rejuvenate operation in the starch processing plant which have in the recent past declined marginally.

“In the light of these and other developments, the Ministry through the Transaction Advisors informed the company of its decision to take over the Ayensu Starch Company in a letter dated 20th December, 2018,” Alan added.

According to the minister, the government has commenced the negotiation of a financial package under the One-District One-Factory Programme in anticipation of government’s smooth takeover of the defunct starch manufacturing factory.

Ayensu Starch Factory was inaugurated in 2004 but however closed operation in 2006 as a result of inadequate raw materials supply among other operating challenges.

Since then, the Ministry of Trades and Industry has been struggling to revamp the factory, including the Public-Private Partnership with Tiberias Company Limited in 2016.

Ayensu Starch Factory was a US$7 million project financed by the Agricultural Development Bank (ADB), National Investment Bank (NIB), the Ghana Commercial Bank (GCB), the Export Development and Investment Fund (EDIF).

The factory has the capacity to produce 22, 000 metric tonnes of grade starch per annum from cassava.

Tiberias Ghana Limited is a limited liability company and was incorporated in Ghana in 2014.

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