NIGERCEM: The Sleeping Giant!

A six-man judicial commission of inquiry into operations of Nigerian Cement Company Plc (Nigercem), Nkalagu, from 2002 till date as they affect interests of Ebonyi State Government is expected to submit its report to Chief Martin Nwanchor Elechi’s government soon.

Governor Elechi had, last year, October 9, while inaugurating the Commission, chaired by Justice Adiran Orah (rtd), charged it to find out the details of the privatization or sale of shares of Nigercem around 2002 and the terms and conditions of such privatization or sale thereof; and to ascertain the extent to which the core investors (Eastern Bulkcem Company Limited) or other investors have operated the Nigercem Factory/Industry vis-à-vis the terms and conditions of the Privatization Agreement or any other agreement or requirement due on their part.

Part of the mandate of the Commission was to find out the present status (including assets and liabilities, as well as the interests of the host communities) of the Factory and make necessary recommendations that would assist in resuming the production of cement from the area. Other members of Justice Orah commission were listed as the Chief Judge of the State, Justice Alloy Nwankwo: Secretary to the State government, Chief Fidelis Mbam, and members of the State Executive Committee (SEC).

It would be recalled that Governor Elechi had earlier set up an Economic Advisory Committee which looked into the fortunes of the company. Based on the committee's report, the Governor petitioned the Federal Government, indicating the state’s desire to take over the company since, in his logic, it had become obvious that Eastern Bulkcem (the core investors) were not prepared to reactivate the cement firm.

But unfortunately, the Federal Government seems to be foot-dragging over this matter, as it is yet to conclusively respond to Governor Elechi’s letter almost three years after, so as to enable him know how to go about in getting the factory back on stream.

Elechi, as Governor of Nigercem’s host state, understandably, feels concerned because of the core investor’s continued delay in reactivating the premier cement company, as a result of which the company has failed to contribute to economic development of both the state and Nigeria in general.

Incidentally, Elechi’s government has, for sometime now, been battling with Eastern Bulkcem over its (Bulkcem)’s insincerity in reviving the ailing cement industry.

Insider Weekly Magazine even learned that Eastern Bulkcem and its collaborators were, rather than reviving dying Nigercem, busy plundering the factory and looting equipment therein. Of course, the alleged looting brought the core investors on a collision course with youths in the area who mounted guard at the premises of the factory. The youths, having interpreted the action of Eastern Bulkcem to mean that its acquisition of Nigercem was borne out of its secret plan to loot the equipment for other personal uses, vowed to halt the looting and dismantling of equipment in the company.

Of note is that Nigercem, owned by governments of the southeast states (Ndigbo), was, following maladministration and insincerity, sold off to Port-Harcourt, Rivers State based Eastern Bulkcem Limited in October 2002. It is common knowledge that the current situation of Nigercem is, to say the least in the mildest way, tear-evoking. Nigercem, which commenced production way back in 1958, was Nigeria’s premier cement company. Nigercem reached its peak when it recorded production of over 480,000 tonnes of cement in 1975.

Then, through its foreign technical partners and interference-free management, Nigercem maintained optimum production as to satisfy local and even international demands. Nigercem generated enough revenues to run itself, including payment of staff salaries and other emoluments.

Following creation of additional states in 1976, Nigerian government reduced its shares and control from 42.9 to 10 percent to enable the southeast states to have majority control in the company. Before now, Nigercem had blossomed to a point of establishing auxiliary factories such as bagging companies, printing outfits, fish farms, hospitals and what have you.

Unfortunately, the federal government’s hand-over of the running of Nigercem to the southeast states marked the beginning of its demise.

At this point, management of the cement outfit became characterized by undue influence and interference by various owner (state) governments. Merit gave way to inducement and appointment of friends and political cronies who lacked the requisite knowledge in high managerial positions in the company.

Nigercem was to sink deeper into the abyss during the second and third republics when the southeast civilian governments evolved a policy that the Chief Executive of the company should be from the host state while the board of directors should be appointed from the remaining owner states. This particular policy literally served as a death knell on the cement company, as offices were filled on the basis of state of origin rather than on merit.

And the eventual privatization of Nigercem in 2002 by governors of the southeast states worsened the already aggravated situation. The governors then included Orji Uzor Kalu (Abia); Chinwoke Mbadinuju (Anambra); Sam Egwu (Ebonyi); Chimaroke Nnamani (Enugu) and Achike Udenwa (Imo).

By the manner of its privatization, the governors had ceded Nigercem to Eastern Bulkcem (manufacturers of Eagle Cement) as majority shareholders. Unfortunately, Bulkcem, it was learnt, violated all the stipulated conditions and guide-lines towards reviving the cement company. A major default of Bulkcem is said to be its refusal to offset arrears of salaries and emoluments owed to the workforce before the privatization.

Many are of the view that it was for selfish reasons that the southeast governors settled for Bulkcem in preference to other perceived better investors, believed to possess funds and needed technical partners to turn the ailing company around then.

For instance, Egwu, host governor then, reportedly secured 20 percent share in Eastern Bulkcem.

In the case of Udenwa, being a one time Accountant of the Eastern Bulkcem, the cement firm, no doubt, reportedly assisted to install him as governor of Imo state in 1999. It was, therefore, natural that Udenwa supported ceding of Nigercem to his former company.

And Orji Uzor Kalu of Abia state was said to have, single-handedly, appointed Chairman of the Privatization Committee of Nigercem.

More notable was the fact that the foregoing were in addition to ‘kickbacks’ Bulkcem allegedly dispatched to the governors to facilitate the ceding of Nigercem to it.

Although Elechi’s government is presently restive over Eastern Bulkcem’s seeming ruination of Nigercem, the state might, eventually, be frustrated by the privatization agreement and ratio, which is that while Bulkcem owns over 70 percent shares, Ebonyi, as the host state, controls only 10 percent. This situation makes Eastern Bulkcem the core investor that is supposed to be in the vanguard of the revival of Nigercem.

Perhaps, another frustration that will militate against Elechi’s quest to salvage Nigercem is the indifference and lack-luster attitude of the federal government in intervening in the affairs of the company, as to ensure that it bounces back to life. And the attitudes of the government of the southeast states are, equally, heart-renting!

All said and done, is not nauseating (if this claim is true) that rather than turn Nigercem around, Eastern Bulkcem is presently busy dismantling and carting away several equipment of the cement company?

Insider Weekly harbors the fear that Eastern Bulkcem might not have stopped at its plundering of Nigercem, as there are rumors that it would have unilaterally sold off the Nigercem liaison office in Enugu. But this rumor could not be substantiated after-all. Also, efforts to elicit reactions from authorities of Eastern Bulkcem concerning their running of Nigercem yielded no results.

But many have continued to wonder whether the situation would be allowed to remain the way it has been with NIGERCEM!

Culled from: Insider Weekly Magazine, Published in Lagos-Nigeria