Gov't Won't Buy VALCO

With barely a month to go before the Committee of Energy Experts submits its recommendations on Volta Aluminum Company (VALCO), top government sources say it is unlikely that government will go ahead to buy the beleaguered company.

Even though the committee is yet to make official statement, sources close to the committee have hinted that the government would be asked to consider providing guarantee for private sector led private acquisition.

Furthermore, members of the special Committee of Energy and Aluminum Experts set up by Energy Minister, Paa Kwesi Nduom have reached a critical stage of their work and they are not going to give blind fold.

By the end of his month, the Committee is expected to issue is findings, advising government whether to buy VALCO or not and also to recommend to government the mode of purchase.

Among other issue being considered are VALCO?s balance sheet and how strategic VALCO is to the economy of aluminum industry in the country and within the sub-region. Other worrying aspects of the purchase that the committee is concerned about is the conflict in government?s policy of non-direct involvement in the operations of corporate bodies in favour of the private sector.

The operations of the company had witnessed a downturn in the past decade, forcing it to reduce its production capacity from over 200,000 tons per annum by more than 80 per cent. Kaiser gave government until March to make an offer or express interest, but initially offered VALCO at between $30million to $80million dollars with a flexible payment system.

If government does not buy VALCO, Kaiser will opt for the next step of its strategy. That is to pack back and baggage and probably sell its assets to individual investors under a concession package. This decision will result in the total collapse of the 50-year old smelter and users of VALCI products will rely totally on imports.