SSNIT defends sale of majority shares in four hotels to boost performance

The Director-General of the Social Security and National Investment Trust (SSNIT), Kofi Bosompem Osafo-Maafo, has defended the decision to sell 60% shares of four of its hotels to Rock City Hotel Limited, owned by the Minister for Food and Agriculture, Bryan Acheampong.

According to Osafo-Maafo, after extensive deliberation, SSNIT concluded that selling 60% shares was the only viable way to make the hotels profitable. The hotels in question include Labadi Beach Hotel, La Palm Royal Beach Resort, Elmina Beach Resort, and Ridge Royal Hotel.

He emphasized that management had exhausted all other options to ensure profitability, including establishing local management teams, which did not yield the desired results.

Osafo-Maafo highlighted that only Labadi Beach Resort had recently started paying dividends to the government.

"We've been through quite a lengthy process. We also tried having external management companies run the SSNIT hotels, which didn't resolve the problem either. We are looking to resolve the issue with the introduction of a strategic investor," he stated at a press briefing held in Accra on July 8, 2024.

He further noted that while Labadi Beach Hotel has started paying dividends, it does not mean it is operating at full potential.

"We want to maximize what we get out of it. The introduction of a strategic investor would make the hotel more profitable, benefiting the government more."

Osafo-Maafo argued that if one were to sell a car or a house, they would make efforts to improve its appearance and value. Similarly, selling a profitable business can be a strategic decision to maximize returns and reinvest elsewhere.

Meanwhile, the National Pensions Regulatory Authority (NPRA) has directed SSNIT to suspend all engagements with Rock City Hotel Limited as a strategic investor for the four hotels.

The NPRA emphasized the need to issue relevant guidelines to guide SSNIT's investment decisions, as stated in a directive signed by its Chief Executive Officer, John Kwaning Mbroh.

Additionally, the Member of Parliament for North Tongu, Samuel Okudzeto Ablakwa, has petitioned the Commission on Human Rights and Administrative Justice (CHRAJ) to investigate allegations surrounding the sale of the hotels.

The MP seeks investigations into allegations including conflict of interest, abuse of power, lack of due process, procurement breaches, cronyism, and graft.

Recently, Ablakwa led a street protest, supported by the Trade Union Congress, to pressure the government to halt the sale of the hotels.

BAI/OGB