MP wants gov’t to probe MPS operations

March 16, 2017
Source: thebftonline.com/Ghana
MP wants gov’t to probe MPS operations

The Member of Parliament for Okaikwei Central, Patrick Yaw Boamah has urged government to investigate the operations of the current managers of the Meridian Port Services (MPS) following the removal of Sutton Energy Limited (SEL) as a shareholder from the MPH shareholding consortium.

According to the Hon.Boamah, two Ghanaians, Kojo Annan and Mr. Michael Wilson who initiated and enabled a port operation project in Ghana were denied the chance to participate in its success due to “egregious and unfair” conduct from the majority shareholders (MPH).

“Our demand is for Sutton to be restored to its rightful position in which it would have been as a shareholder had it been provided with the opportunity to take part in the share issue and exercised its right.”he said.

The majority shareholders of MPH are claiming that they provided due notice of the rights issue by sending letters of notification to the addresses provided by Sutton in the shareholders agreement. Even though those letters were returned to sender and confirmed as undelivered, they claim that legally they have fulfilled their obligations.

Sutton counters this with clear evidence of lack of good faith or reasonable business ethics. No attempt to communicate via email, telephone etc even though all previous correspondence of the past seven years had been done in this manner.

Background

Mr Annan and Mr Wilson first approached the Ghana Government in 1999 with an idea of rationalising the operation and management of Tema Port. Between 1999 and 2002 they discussed and refined the project with the highest officials of the Ghanaian Government. This was the beginning of what later became the MPH consortium which operates the port of Tema in Ghana through its subsidiary Meridian Port Services Ltd (MPS).

Upon the then President of Ghana's request, the MPH consortium included the multi national companies AP Moller (Maersk Group) and Bollore the biggest users of Tema Port. They became the majority shareholders from the outset and Mr Annan and Mr Wilson, through their company Sutton Energy Limited (SEL) the minority shareholder with a 6.75% interest in MPH.

In October 2002 the Minister of Road and Transport for Ghana announced the formation of the MPH consortium and the plans for the fast track development and management of the container terminal in Tema. SEL was a part of this public announcement and listed as a shareholder.

There is no disputing the role Sutton (SEL) played in creating the project and getting it off the ground after over 6 years of development work. As co shareholders of such a lucrative opportunity they expected to be treated with appropriate co-operation, fairness and good faith at all times. Unfortunately, the opposite has been the case and through manifest breaches of the shareholders' agreement they have been disregarded, marginalised and the majority owners have all but removed SEL from the project.

In late 2009 MPH passed an unlawful share issue that resulted in a devastating drop in SEL shareholding from 6.5% to 0.0093%. 

They have also failed to pay SEL any dividends throughout this period and refused to act in good faith with SEL in relation to its status as a co-shareholder.

In financial terms the unlawful conduct rendered the value of Sutton's shares to drop from a conservative valuation of around $15m in 2009 to a purely nominal sum.

The valuation of the said shares will be significantly higher today in 2017 not to talk of the further 8 years remaining on the current concession agreement and the additional 30 year extension recently granted to MPS.