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PRIVATISATION yesterday, the federal government’s reasons on the privatisation was highlighted. This second installment of Businessday’s investigative analysis reveals how Nitel’s privatisation epitomized the failure of the liberalisation exercise Since the privatization exercise that saw the sale of some of these once moribund government entities, many of them have turned their fortunes positively around and are thriving. Investors like Dangote Industries, UAC properties, Broadfield, Kaduna State and ASD Motors as well as Blue Circle/Larfarge, Consolidated Petroleum( ConOil) and Indorama Group to mention a few have turned around successfully. Enterprises like Unipetrol now Oando, AP plc, National Oil and Chemical Marketing company plc now ConOil, Festac 77 now Durbar Hotel, Peugeot Automobile Nigeria plc, Nicon Hilton hotel now Transcorp Hilton hotel, the port terminals, the cement companies, the automobile companies and Eleme Petrochemical are equally doing well. 
Transcorp Hilton hotel is still the hotel to beat in Abuja, while Festac 77 hotel has shelved its previous toga competing for a saizeable portion of the Lagos hospitality market. At Eleme Petrochemical, the story is a success. The company has picked up, and has started production feeding the plastic and other chemical industries with raw materials. 
Today, ConOil filling stations scattered all over the country is thriving. On the floor of the Nigerian Stock Exchange, NSE, shares of companies like Oando, WAPCO and Benue Cement are stable suggesting investor’s confidence. As at last week Friday, Benue Cement traded at N34.44, Wapco, N25.50, Oando traded at N89.86 and ConOil at N54.26.
Though cement price is yet to crash due to the activities of the cartel in the industry, feelers show cement companies privatized are doing well under the tutelage of private initiatives and the once red account is changing.
The same goes for the automobile firms like Anambra Motor Manufacturing Company bought by G.U Okeke and sons, National Trucks Manufacturers, Leyland Nig. Ltd and Steyr Nigeria Ltd who are all assembling automobiles of different categories in the country now. 
To an extent, the various port terminal operators have been able to move activities to higher heights though not yet uhuru in the sector due to the alleged corrupt activities of the Nigerian Customs Service.
These enterprises now managed by the private sector concerns have all combined to become the positive and success story of privatization and a reference point of how a state enterprise could be turned around for better service delivery. 
But it is not all success for the BPE. Post privatization era of many of its flagship transactions have dwarfed the positive public relations engendered by the successful privatized enterprises. Enterprises listed above represent a small fraction of government entities that have become a success story through private initiatives. Larger percentage of the flagship transactions consummated between 2002 and date have either failed or on the verge of collapse.
For instance Assurance bank formerly Nigeria-Arab bank was acquired by Parmex/Gensec consortium in March 2002. It started operations with high hopes which could not go beyond 2005. It exited the banking industry via the sector’s consolidation exercise and could not enter the new phase in the sector which debuted in 2006. This speaks volume of the competence as well as the financial capacity of the buyer. It also shows the lapses in the due diligence conducted on the investor by the BPE prior to the sale.
Assurance bank is not the only one in this category but its case beats observers’ imagination that an enterprise which the government sold its 90 percent equity for N853.2 million in March 2002 could go into extinction within four years.
Nigeria Reinsurance Corporation sold to Reinsurance Acquisition in December 2002 is neither here nor there in the sub-sector in which it operates. It has failed to make an impression in the insurance industry since its acquisition under the veil of a management buy-out but remotely controlled by the then Broad Bank which had violated its obligor limit in addition to facilities from creditors to finance the acquisition. 
The case of Nigeria Re is pathetic because insurance business dwells on utmost good faith and the ability to give succor in the time of crisis. Bank balances of the enterprise as at first quarter 2009 shows it is financially weak. For instance, its total balance in the local banks was N43.219 million. Balances in its foreign accounts in the same period stood at $753,944.70, its Euro account had 109,872.32 Euros and £161.70. 
Its claims profile as at first quarter 2009 was threatening its existence. It has N264.676 million claims that were due for payment in the local currency, £2,267 pounds denominated and $227,808 in dollar denomination. This, among others prompted insurance regulatory body, National Insurance Commission (NAICOM) intervention in November 2007.
Daily Times of Nigeria was one of the flagship transactions of BPE under the on-going privatization programme. It was sold under the core investor sale option in June 2004 to Folio Communication. The core investor has failed to turn around the enterprise which is now neck-deep in debts from salary arrears and others.
Abuja Sheraton Hotel and Towers Plc sold to Hans Gremlin in October 2002 is losing its share of the Abuja market daily to competitors who are springing up every day with better service delivery. Twice, both Atiku Abubakar and Ngozi Okonjo-Iweala, two prominent figures in the ex President, Olusegun Obasanjo administration that mid-wifed its sale and chairman and vice-chairman respectively of the National Council on Privatization (NCP) ordered that the BPE and the finance ministry should stop using its facilities for events because of its falling standards. Its air-conditioning facilities have severally failed to work forcing the use of standing fans in its Ladi Kwali hall reputed to be the biggest auditorium among hotels in the federal capital territory.
Aluminum Smelter Company ALSCON Ikot Abasi was sold to the Rusal Group in controversial circumstances in 2005. NCP under the full glare view of television camera declared BFIG the preferred bidder for ALSCON at a financial bid opening shown and broadcast live but went ahead to negotiate with the Rusal Group that was disqualified for presenting a conditional bid at the same bid opening. Despite several protests by BFIG, the Russian went away with ALSCON which sources said it is yet to be fully paid owing to conditions precedent to the sale like the dredging of the Imo river. Beside the hostility to Rusal by the communities who felt BFIG was robbed, militant activities owing to lack of corporate social responsibilities from the Rusal have stalled its operation since take over.
Nicon Insurance sold to Assurance Acquisition Ltd in 2005 is also another privatized enterprise mired in controversy since the sale of the 70 percent government equity through the Core Investors Sale CIS option. Other parties involved in the acquisition had alleged the transaction was hijacked fraudulently. Nicon Insurance since its acquisition has dwindled steeply from its lofty height in the insurance industry. Weighed down by huge claims profile and other technical issues which forced the intervention of the regulatory body, the National Insurance Commission (NAICOM) in 2007, its competency has also been affected by the exit of its experienced hands coupled with outstanding salary arrears.
Concession of the Nnamdi Azikiwe airport in Abuja is still generating disquiet between the BPE and the Aviation ministry and it is feared the privatization agency may not get the full cooperation of the ministry in subsequent exercises.
The manner in which both Ajaokuta Steel Complex and the Iron and Ore mining company Itakpe were awarded to Global Infrastructures Holdings, India for concession has clearly marked the two for failure. Without any process or check but because of political patronage, the two were handed over to the Indian companies allegedly fronted for by close relations of former president, Olusegun Obasanjo.
It is no surprise that the assets of the two companies were stripped and taken to Delta Steel, Aladja which was acquired by the same Indian companies. Today, the two companies are carcasses while equipments are rotting away. Those bearing the brunt of such failures are the workers most of whom that have pledged their life to the enterprises. 
The loss of the federal government also continues as salary arrears and pension liabilities keep mounting. During last year budget defense, mines and steel ministry demanded for N400 million to maintain the facilities at the moribund enterprises from rust. This is an investment that will not yield any return.
Nitel privatization was a flagship transaction that has given the federal government liberalization programme a negative image. Thrice it has been consummated and thrice it failed. Just like the Power Holding Company of Nigeria that has been jinxed, Nitel/Mtel has been a sorry case defying several interventions at salvaging it. From its lofty heights in the telecom sector as the first national carrier, the company has failed to justify the huge investments in it because of corruption and lethargic attitude of the workers.
Federal government investment in the moribund telecom firms from its days as P&T is unquantifiable. Besides are the money spent on preparing it for privatization which comprised of fees for advisers, advertisements for Expressions of Interests (EOIs). 
Nitel today, represents the corrupt face of the country as well as the failure of the privatization agency, the country’s leaders and the private sector that acquired it for management. 
It is unfortunate that the privatization agency could not find any answer to the repeated calls by the workers for salvage and by the time it acts, staff salaries arrears have climbed to 11 months while its market shares have plummeted from 15 percent to 0.03 percent.