Ghana’s Government investigates Vodafone agreement
The new National Democratic Congress (NDC) government has set up a committee to review the Vodafone/Ghana Telecom sale agreement that was concluded under the government of the New Patriotic Party (NPP) in August 2008. Despite accepting the sale of Ghana Telecom to Vodafone, the new Government has set up a Committee to investigate the sale as a piece of political “window-dressing”: it is unlikely that much will come of it.
According to a Joy Business News bulletin monitored by ghanabusinessnews.com, the Minister for Communications, Haruna Iddrisu made the announcement in London in a meeting with Vodafone Plc officials. Iddrisu was in London to attend an ITU meeting. According to the report, the Ghana CEO of Vodafone, David Venn was present at the meeting.
The Vodafone Review Committee is expected to review the 70% sale of Ghana Telecom (GT) to Vodafone and make recommendations to government to be submitted to Parliament. The Minister was quoted as saying that the review was to ensure that there were no underhand dealings in the deal - and this is being done in fulfillment of the NDC’s promise to the electorate, he said.
During the election campaign in 2008, the NDC promised to revoke the sale of Ghana Telecom, if it was elected into power. But soon after the party won the 2008 elections, the government, aware of the investor communities’ sensitivity to government interference in such matters, said it would not revoke the sale.
The Minister said the committee would determine whether there was any justification for an indemnity clause in the agreement, and find out if there were better offers than the Vodafone offer that were ignored by the government. The committee would also investigate the reason for the inclusion of the national fibre optic backbone into the agreement, because in the view of the government that should remain a national asset.
It would also investigate the disbursement of a $228 million escrow accounts and take a look at the decoupling of the Ghana Telecom University from Vodafone Ghana. In addition to establishing the true ownership of the 70% share, the Vodafone Review Committee would seek to establish why some of the huge liabilities of Ghana Telecom were not disclosed before the sale.
The committee would investigate the rationalization programme under which the company is offering packages for workers of Vodafone Ghana, to resign voluntarily. According to the report, other issues unrelated to the sale of Ghana Telecom that would be investigated include why transaction advisors to the Ghana Telecom sale, Ecobank Development Corporation (EDC) was suspended. The committee would also be expected to determine whether monies due to EDC were paid as well as the tenure of Telenor of Norway as managers of Ghana Telecom.
When Ghana Telecom was put up for sale, other political parties including the NDC, then in opposition, opposed it. Other groups like the Committee for Joint Action (CJA), a political pressure group also vehemently opposed it but the then government with a majority in parliament approved the sales agreement.
Meanwhile, on Wednesday night April 15, 2009 at a ceremony in Accra at the Accra International Conference Centre, Ghana Telecom and Onetouch, the mobile telephony offshoot of the company became were branded Vodafone with all the colours now changed to red - the colour of Vodafone’s corporate branding.
Ghana Business News