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Business News

HealthPlus: Business owners call for more protection from FG against ‘dubious’ foreign investors

Business owners have called on government to protect them from alleged forceful takeover by some private equity firms.

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HealthPlus: Business owners call for more protection from FG against foreign investors

Following the crisis that is rocking HealthPlus Nigeria, entrepreneurs have called on the Federal Government to protect their businesses from what they described as alleged forceful takeover by some private equity firms.

The business owners also identified foreign equity firms as major threats to the well-being of Nigerian entrepreneurs and their businesses.

They disclosed this at the recent interactive session organised by Business Founders Coalition (BFC) in Lagos.

During the session, Coordinator, Business Founders Coalition, Dr Richardson Ajayi, explained that private equity firms are preying on Nigerian businesses and are seeking to push their founders out.

READ: Nigerian firms expect to start employing again in August – CBN survey

This, according to him, threatens the nation’s dream to build and nurture vibrant private sector businesses capable of competing with global brands and also reduce employment opportunities for the youth.

He said, “The government and other stakeholders need to understand the plight of Nigerian entrepreneurs who out of sweat and grit started their businesses but at some point in the pursuit of growth, have had to access venture capital funds or foreign investments.

“Our experiences have largely been tales of woe, which have the possibility of stunting the growth of indigenous businesses like ours. We are also hoping that through this coalition, government can enact policies and laws that will correct that apparent lop-sidedness.”

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READ: Are SMEs the solution to Nigeria’s wailing economy?

According to Ajayi, who is also the Founder of former Parthcare, now Synlab, most local businesses have been struggling due to unfavourable operating environment and lack of access to finance to grow their business, hence they approach foreign investors and venture capitalists to invest in their businesses.

While he acknowledged that there are many good private equity companies that have accomplished successful private equity transactions, as well as those that understand the challenges of the market and are patient with their local partners, Ajayi noted some others seek controlling rights as a major condition to invest and in the long run forcefully takeover the businesses.

Also at the session, Founder, HealthPlus, Bukky George, called for evolution of policies that would regulate activities of private equity firms.

READ: Why is the US stock market index going up even as COVID-19 remains unchecked?

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According to her, bringing a private equity firm into the operation of HealthPlus was to enable the company to meet the demand for high quality yet affordable healthcare and beauty supplies through distribution centres in Nigeria.

She said, “Unfortunately, the pledged funds were never fully disbursed in order to implement our strategic objectives.

“Our partnership has been fraught with serious challenges and unmet expectations, jeopardising operations and relationships with our stakeholders.”

READ: The game is changing, as entrepreneurs are thinking globally for their small businesses.

George urged the Central Bank of Nigeria (CBN) make flexible loans available to the health sector such that cash flows of companies would be considered as against only collateral.

She said that doing so would enable businesses scale up in order to achieve their potentials, enhance the economy and development of the health sector.

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Managing Director, CMC Connect Ltd, Mr Yomi Badejo-Okusanya, explained that the coalition was not about a single organisation, but about changing policies to assist businesses to thrive and boost investment.

Abiola has spent about 14 years in journalism. His career has covered some top local print media like TELL Magazine, Broad Street Journal, The Point Newspaper.The Bloomberg MEI alumni has interviewed some of the most influential figures of the IMF, G-20 Summit, Pre-G20 Central Bank Governors and Finance Ministers, Critical Communication World Conference.The multiple award winner is variously trained in business and markets journalism at Lagos Business School, and Pan-Atlantic University. You may contact him via email - [email protected]

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Why the proposed Borno power plant may not materialise 

The glaring security challenge cannot be overlooked in considering a major power plant project in Borno State.

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Only a few days ago, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kyari, led a delegation to Borno State to meet with the Governor of the State, Babagana Zulum.

In the conversation with Zulum, Kyari promised the establishment of a gas-fired power plant in Borno State within a maximum of 4 months to solve the recent blackouts that resulted from insurgents cutting off Borno from the national grid since January this year.

In Kyari’s words, “We have talked to each other and we think it’s very possible to establish a dedicated power plant in Maiduguri which will serve current needs of power supply not only in Maiduguri but to other parts of the neighbouring cities.”

Yet, there is a significant possibility that the power plant promised by Kyari may not materialize for many reasons, the first of which is security. In the meeting with Kyari, Governor Zulum had noted: “The ongoing insurgency has cut off the entire Borno from the national grid in the last three months. We put all our efforts and restored it back… but unfortunately, after 48 hours, the same group of insurgents went back and destroyed the main tower again.”

This glaring security challenge cannot be overlooked in considering a major power plant project in Borno State, particularly noting that the State and its surrounding communities have been the hot zone of insurgent and terrorist attacks by Boko Haram insurgents since 2009. Borno, Yobe and Adamawa have particularly been states where the insurgents have set up shop and carried out various activities, including kidnap, extermination of entire communities, burning of markets and religious buildings and the attack on the United Nations compound, in each case claiming tens or hundreds of innocent lives.

One report reveals that at least 37, 500 people have been killed by the insurgent group since May 2011, a modest number, some say. Also, till date, some of the secondary school girls kidnapped in the April 2014 Chibok incident are yet to be returned to their families. It is then bewildering how Kyari intends to see to the construction and operationalizing of this gas power plant.

Additionally, while the Minister of Petroleum for State, Chief Timipre Sylva, announced last year about the discovery of oil and gas deposits in the North, we have not seen any exploration and production kick-off. It then begs the question of where the gas for the Borno power plant intends to be sourced. The only gas pipeline that runs through the North – the AKK- is still in its first phase of construction out of three phases and has been earmarked at the earliest, to be completed in 2023 – not counting the typical delays the project will experience along the way.

Should the AKK by some stroke of luck materialize much earlier than the target date, the pipeline route is a considerable distance from Borno. It runs the route of Ajaokuta-Abuja-Katsina-Kano, its endpoint, a striking 481km from Borno State. Thus, there would have to be construction of a tie-in pipeline almost as long as the AKK from Kano to Borno State to get gas to Borno.

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Optimists may reference the oil and gas discovery in the North and how production may start soon, thus obliterating the need for a 481km pipeline. This optimism however is not well-founded, as insecurity has been shown to be a major risk to oil and gas projects everywhere in the world. One of the major reasons the Trans-Saharan Gas Pipeline proposed to run from Nigeria to Algeria was abandoned was due to security challenges posed by Nigeria’s Movement for the Emancipation of the Niger Delta (MEND), the Tuareg guerilla movement in Niger and other insurgent groups along the proposed route of the pipeline.

These increased the risks across board, including for completion and operations through the lifecycle of the project. As such, failing to fix the security threats in northeast Nigeria makes any proposed gas plant project a pipe dream. Transporting gas via LNG trucks is not a better option, given that the drivers and their cargoes would be in danger of being kidnapped, shot at or bombed. The risks for both personnel and investors are high.

In any event, promising a power plant in 4 months for the people of Borno is unconscionable, since a typical gas power plant will take between 1 to 6 years to construct in relatively peaceful regions. What the government needs to do instead of making promises it cannot keep is to work arduously to fix the security challenges in Northern Nigeria and at the same time consider using decentralised solar power to provide power supply to homes, government institutions, schools and businesses while plans to produce gas in the region or transport gas to it are underway.

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Lagos Commissioner of Police dismantles road blocks on Lagos-Badagry expressway

The Commissioner warned the concerned Area Commanders to take action on full compliance as any defaulter will be sanctioned accordingly.

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The Commissioner of Police in Lagos State, CP Hakeem Odumosu, has ordered the immediate dismantling of all illegal roadblocks by police teams from the command on the Lagos-Badagry expressway.

The directive is to checkmate the illegal activities of the police on that route which have been condemned by the government, some stakeholders and international bodies and also bring sanity and decency to their operations along that axis.

That disclosure is contained in a statement signed by the Police Public Relations Officer of the Lagos State Police Command, CSP Olumuyiwa Adejobi, on Saturday, April 10, 2021.

Adejobi in the statement said that CP Odumosu gave the order on Friday while addressing Area Commanders and Divisional Police Officers in the command on the general security situation in the state and reviewing the anti-crime strategies of the command in order to sustain its feats on crime control.

What the statement from the Lagos State Police Command is saying

The statement from the Lagos Police Command partly reads, “In his bid to restore sanity and decency to the operations of the police along the ever-busy international route, Lagos/Badargy Expressway, the Commissioner of Police, Lagos State, CP Hakeem Odumosu, has ordered for the immediate dismantling of illegal roadblocks by the police teams from the Lagos State Police Command.

The police boss, while reacting to some complaints from the general public and some security reports on the police activities along the international route, ordered the Area Commanders and Divisional Police Officers whose jurisdictions fall along the Badargy Expressway; Festac and Area K, Marogbo, to withdraw their men from the illegal roadblocks and embark on aggressive motorised patrol and surveillance to police their areas and the route.

The Commissioner of Police confirmed that the illegal police roadblocks along the route have been condemned by the government, international bodies and interest groups and they must be dismantled without delay,” he said.

The Commissioner, however, noted that other police operatives from other police formations, outside the supervision of the Lagos State Police Command who operate along the route, would be contacted to adjust and do the needful to restore sanity to their operations.

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The CP Odumosu then warned the concerned Area Commanders to desist and take necessary action on full compliance with his order as any defaulter will be sanctioned accordingly.

 

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