v

The federal government has reached an out-of-court settlement with United Co. Rusal Plc over the sale of the Aluminium Smelter Co. of Nigeria, ending a decade long ownership dispute over the company.

The parties according to Bloomberg, agreed Alscon would resume operations in six months as part of the settlement, Kayode Fayemi, Minister of Mines and Steel Development, told journalists in Abuja, the capital. The smelter had been idled since 2012.

“We feel that apart from the legal issues, Rusal are actually best placed to be able to reactivate the plant,” Fayemi said Wednesday.
Government now owns a minority 20 per cent of the smelter, Rusal 80 per cent, the minister said.

These numbers were disputed yesterday by Rusal whose spokesperson said the company retained 85 per cent and Nigeria 15 percent. Calls to Fayemi’s office to seek a clarification were not answered.

The settlement follows a decision in September to opt for mediation after a Supreme Court ruling in 2012 that voided the sale of Alscon to Rusal.

The court ruled that Bureau of Public Enterprises (BPE), the privatisation agency, didn’t have the right to cancel an earlier sale of the smelter to Bancorp Financial Investment Group in 2007.

“The Alscon sale dispute is one of the long drawn ownership battles that has impacted Nigeria’s ability to stick to contracts,” said Cheta Nwanze, an analyst at Lagos-based business advisory group SBM Intelligence.

“Now that the dispute has been resolved, the smelter can return to production which will obviously have a knock-on effect on various industries in the economy,” he said.