SSNIT Hotels Sale: Ablakwa drops damning memo on conflict of interest, availability of funds

Member of Parliament for North Tongu, Samuel Okudzeto Ablakwa, has released additional details regarding the controversial sale of 60 percent shares of SSNIT hotels to Rock City Hotel, owned by the Minister of Agriculture, Bryan Acheampong.

According to the lawmaker, the memo's findings suggest that SSNIT may have unfairly favoured Rock City Hotel amidst allegations of conflict of interest before approval was granted to engage in further negotiations.

This revelation could also directly implicate SSNIT's Board Chair, Elizabeth Ohene, who recently defended the transaction as clean, fair, and transparent.

Among the key details of the memo intercepted by the North Tongu lawmaker, Rock City Hotel made a proposal of US$61.20 million, offering an initial instalment plan of US$30.80 million, with the balance spread over 24 months.

Subsequently, the Rock City Hotel, per the memo shared by the MP, showed it did not confirm its availability of funds to make the purchase.

"Payment is based on the cash flows of Rock City with no credit enhancement from any bank," the lawmaker's memo, shared via X on July 3, 2024, read.

"The 2-year instalment plan was not made available to all bidders. Other investors who submitted bids were not given an option to spread payments," Ablakwa revealed.

Here are the key revelations from SEM Capital's intercepted memo shared by Okudzeto Ablakwa via X:

1) Rock City's US$61.20million latest proposal offers an installment plan (an initial US$30.80million with the balance spread over 24 months) with no confirmation of availability of funds. Payment is based on the cash flows of Rock City with no credit enhancement from any bank.

2) There is no indication of ability to pay.

3) The arrangements for the transfer of the shares do not satisfy the objectives of SSNIT as contained in the TOR for this transaction. Transfer of the management and ownership will take 2 years.

4) The 2-year instalment plan was not made available to all bidders. Other investors who submitted bids were not given an option to spread payments.

5) Rock City's proposal does not include a bank guarantee.

6) Rock City does not have cash reserves to support the instalment payments.

7) Rock City's financials cannot support their installment proposal which will require periodic payments of US$7.8million (GHS109.7million).

8) Rock City's proposal, which SSNIT was entertaining, did not meet the requirement to demonstrate the financial capacity to close the transaction.

9) Rock City's proposal does not indicate the source of funding for the balance of the acquisition price.

Newly obtained explosive documents on the sale of our SSNIT hotels reveal more damning evidence against Hon. Bryan Acheampong’s Rock City Hotel and SSNIT.

On the 24th of May, 2024, the Transaction Advisor, Dr. Sam Mensah of SEM Capital wrote to the SSNIT Board of Trustees on… pic.twitter.com/HXbSLqWxjo

— Sam Okudzeto Ablakwa (@S_OkudzetoAblak) July 3, 2024