General News of Sunday, 12 August 2018
Dzata Cement has explained the collapse of UT Bank in 2017 could not have been because the company defaulted in repaying a loan facility.
A press statement issued on behalf of Ibrahim Mahama who owns the cement factory said the repayment of the loan was to start after the factory began operations and cement sales.
But even before this could happen, the licence of UT Bank was withdrawn by the Bank of Ghana in August 2017 and was taken over by GCB.
The $200m Dzata Cement was only 80% complete when the bank collapsed, the statement said. The cement factory had projected a daily revenue of one million cedis which the lawyers say could have cleared the loan under five years.
Dzata Cement, Holman Brothers Ltd, MBG Ltd and Engineers and Planners are four companies owned by Ibrahim Mahama which took loans from UT Bank.
The four companies received ¢261.4m with Dzata Cement receiving ¢131.5m, according to a financial autopsy report obtained by Joy News.
But lawyers for Ibrahim Mahama have disputed the figure but declined to state the amount taken.
Dzata cement factory was commissioned in November 2016 at the Free Zones enclave in Tema. It has a reported capacity to produce one million tons of cement annually and became the third local cement manufacturing company after Ghacem and Diamond Cement.
The project which started in 2012 and commissioned in 2016.
BRIEF FACTS ABOUT BANK FACILITIES WITH UT BANK NOW IN RECEIVERSHIP)
1. The sum of money put out there as the amount owed by companies 'owned' by Ibrahim Maliama is not accurate and not a reflection of the facts and documents.
2. Over a period of time, a group of companies with a company purpose and vision conceived the idea of jointly establishing a cement factory in Ghana and accordingly pulled resources together to actualize this vision.
3. Pursuant to the vision. Dzata cement Rd put together a proposal for funding and sent them to a number of Banks for financial support.
4. UT Bank after a thorough due diligence on the companies agreed to offer financial support to Dzata cement ltd on terms.
5. The outlining agreement which culminated in UT Bank offering financial assistance was that, it will provide liquidity support to Dzata Cement until the factory commence operations and starts selling its cement.
6. The agreement was that all payments or proceeds from the sale of cement will be paid directly into an account owned and operated by UT Bank.
7. Indeed it was agreed by the Parties that UT Bank will have a branch on the premises of the factory which will serve as pay point for all products purchased by customers.
8. The projected revenue per day from the sale of cement was a minimum of GHC 1,000,000 and with this projection Dzata would have paid off the loan with the interest in less than five years.
9. It was agreed that UT Bank will finance the cement factory till it becomes operational but this unfortunately could not happen due to the revocation of its licence last year. At the time the Bank's licence was revoked the records will show that the project was about 80% complete
10. Due to the unexpected revocation or the Bank's licence Dzata had to resort to other financiers for support to complete the project. In February 2018, government of Ghana gave the Cement company clearance to import 1.2 million metric tonnes of bulk cement for re-bagging based on evidence of installed bagging Plant.
11. As stated earlier, the loans advanced to Dzata cement was to be repaid from the proceeds of the sale of cement. Clearly at the time the Licence of the Bank was revoked, Dzata could not have been in a position of default because the factory was not operational then.
12. It must also be noted that, Mr. Ibrahim Mahama did not contribute in any way towards the 'collapse' of UT Bank. the evidence available to the Bank will show clearly that the loans taken by Dzata Cement were over collateralized.
13. The report purportedly making the rounds in the media may have been skewed or misrepresents the facts and therefore should be dismissed.
Sgd. Reindorf Twumasi Esq 0243533095