(Special Report) Concession of Lagos Trade Fair complex: odds favour LCCI but…
…Fight by current tenants may be deadly not minding FG’s indemnity pledge
Another rather more complicated round of bidding is underway for the re-concessioning of the Lagos International Trade Fair Complex (LITFC) on Lagos-Badagry Expressway.
Several veiled firms and the Lagos Chamber of Commerce and Industry (LCCI) have since submitted their bids, but the current occupiers may not be aware that the carpet they are currently standing on is about to be swiftly drawn away for their total fall.
Business Hilights Intelligence Unit (BHIU) recalls that earlier in September 2017, the federal government through the National Council on Privatization (NCP) revoked the first concession of the massive commercial centre and the Concessionaire, Aulic Nigeria Limited was eased out without recourse to associated litigation and yet to be vacated court order in a competent court of jurisdiction.
The Federal Government in revoking the concession claimed that Aulic Nigeria Limited performance as the concessionaire was sub-optimal regarding the infrastructural facilities under concession.
However, the government was not crafty enough in giving out the above reason as followers of the deal are aware that the key problem frustrating the concession was the inability of the government to return to drawing board with the concessionaire, Aulic Nigeria Limited to renegotiate the new value of undeveloped areas as government had removed some portions of the complex that had been developed and occupied by several trading groups after the Aulic was announced bid winner.
Aulic Nigeria Limited had won the concession with a N40bn bid proposal before the developed areas were carved, thus making the facility far less than the original total land space of the complex.
Currently, Aulic Nigeria Limited is still in court and in possession of an order of a competent court of jurisdiction since 2014 restricting any government agency or body from further action pending the determination of the substantive suit which is yet to be determined before the federal government sacked him.
Whereas the order is yet to be vacated, the federal government through the NCP in particular, went against the subsisting agreements with Aulic Nigeria Limited and an order of the court to sack the concessionaire and planted a political appointee as the administrator of the complex, Mrs Lucy Ajayi.
Observers say the entire Commando-styled moves were to clear way by any means possible for another round of concession.
In August this year, the council approved Agri-Africa Consultants/A & E Law Partnership Consortium as advisers for the fresh concession of the complex and other facilities.
Only last week, during a press conference to announce the plans and programmes of the 2018 Lagos International Trade fair holding at Tafawa Balewa Square (TBS), the Chairman, Trade Promotion Board, LCCI, Mr Gabriel Idahosa, disclosed that the Chamber is among the organisations requesting to be considered as possible concessionaires for the Lagos International Trade Fair Complex along the Lagos-Badagry Expressway.
He made it clear that “We have applied for the concession.”
Reference to the comments of the LCCI official, analysts say the Chamber may be favoured when the electoral pledges of President Muhammadu Buhari during the very last lap of presidential campaign in Lagos to the government and people of Lagos State are under consideration.
It would be recalled that President Buhari had almost completed his address when former Governor Babatunde Fashola approached him on the podium and whispered to him.
Though it was difficult to decode what he might have told Buhari, but it was clear that after the few seconds whispering, Buhari returned back to the podium and announced that if he wins, his administration will consider to handover some moribund federal establishments.
It would be recalled that the first asset, the State House Marina had few months ago, been handed over to Lagos State government.
Analysts say one of the key targets of the state government is LITFC considering the unprecedented volume of private sector investments in the massive space.
Whereas the current tenants including ASPMDA, BBA, APT and several other investors who were allocated plots by Aulic have all developed their portions to world class trading plazas, investigations revealed that in less than one year of Mrs. Ajayi, several open spaces had been sold out; leaving very limited space that may not accommodate an international trade fair and exhibition.
Currently, any prospective bidder must be ready for barrage of court cases that must emerge immediately it is declared the preferred bidder.
Analysts say this may be the reason why the Minister of Industry, Trade and Investment, Dr. Okechukwu Enelamah has said that the Federal Government was ready to provide indemnity to ensure that the re-concessioning of the LITFC is successful.
Speaking at the kick-off meeting for advisory services for the concession of the LITFC in his office in Abuja recently, the minister said that the concession must be done right as “the Federal Government is prepared to provide indemnity to cover all the legal issues and other encumbrances on the LITFC”.
A statement issued by the Ministry’s Head, Public Communications, Amina Tukur Othman, commended the leadership direction of the Bureau of Public Enterprises (BPE) led by Mr. Alex A. Okoh on the LITFC re-concessioning, adding that “on behalf of the Federal Government and this ministry, I wish to note that it is important to always do the right thing, as it is being done now on the Lagos International Trade Fair Complex by the professionals at BPE”.
Further investigations by BHIU show that all the trading groups in the complex are in serious consultations on how to handle the impending doom that will surface immediately a new concessionaire is announced.
Besides, whoever wins the emerging bid will have more than five years to go to court no matter the level of indemnity coming from the federal government because the current Trade Fair Stakeholders’ Forum (TFSF) and investors who had spend good money developing their allocated portions will not be willing to give in so cheaply and without a deadly fight after all.
However, a major takeaway from series findings by BHIU is that considering the quantum of building developments and general investments on ground by existing trading groups put at over N10 trillion, they may NOT succumb easily to another form of control in the name of a concessionaire. This issue will definitely be the baptism of fire for whoever will win the emerging concession round being conducted by the BPE powered by the NCP.