The Minerals Income Investment Fund (MIIF) has assured the nation that the various agreements passed by Parliament last Friday were in line with the objects and powers of the Fund as set out in the MIIF Act.
It has, thus dismissed reports in the public domain claiming that the agreements were passed without the proper oversight and debate.
According to MIIF, the agreements passed through the same due process as all other agreements are dealt with in Ghana.
Misconceptions cleared
A statement issued by the Public Relations Unit of MIIT noted that, contrary to the impression created that the agreement would make it impossible for a future government to replace managers of Agyapa Royalties Limited, a Special Purpose Vehicle (“SPV”) that is expected to list on the London and Ghana Stock Exchanges, the SPV will adhere to international corporate governance standards as would be expected of a publicly listed company.
The board of directors of Agyapa Royalties Limited will be up for election every year at its Annual General Meetings.
It added that MIIF will be the largest shareholder in Agyapa Royalties, and therefore will exercise its right to vote on the directors.
The statement further said that all agreements relating to the transaction are subject to the MIIF Act 2018 (Act 978) and any subsequent amendments.
It debunked the assertion that the agreement is based on the amendment done to the Minerals Income Investment Fund Act approved by Parliament but not signed into law yet by the President, and therefore making it illegal.
No mortgaging
MIIF further said the suggestion that it is a bad idea to mortgage future revenues from gold royalties for a lump sum of money today is erroneous, explaining that this is not mortgaging of the country’s future revenues.
“This is an investment in our future which will create an upfront sum of capital upon the proposed listing date and, thereafter, regular dividends, both of which will be reinvested into the country to finance strategic capital investments such as infrastructure to spur socioeconomic development and enhance the lives of all Ghanaians. The cost of capital through this transaction is therefore lower than any debt capital raised, with the added advantage of no repayments.
“Given that gold prices are at all-time highs, the timing is right for the shares to be listed in London and Ghana. We believe Ghana must invest in itself and build a future through investment, not aid, and this is a key way to achieve this,” the statement said.
It added that the suggestion that Agyapa is the current government’s attempt to mortgage 75.6 per cent of the country’s mineral revenue in perpetuity cannot be right. It explained that Agyapa Royalties will receive 75.6 per cent of royalties from a selected portfolio of underlying gold mines (12 producing mines and four development assets) under the current mining leases.
In addition to the initial capital raised, MIIF is expected to continue to receive dividends from Agyapa, and will continue to receive the royalty revenue from other operating mines in Ghana that are not related to Agyapa Royalties.
“Agyapa Royalties will continue to benefit the Ghanaian people, regardless of which political party is in power,” it said.
It further noted that the claim that “shareholders other than GoG will own 75.6 per cent of Ghana’s royalties and therefore its future” is untrue.
“At the closing of the IPO, Agyapa will hold rights to receive 75.6 per cent of the royalties from the 12 producing mines and four development assets in its portfolio. Agyapa is not acquiring the rights to all off Ghana’s royalties. Further, as discussed above, the GoG, through the MIIF, will continue to be the majority shareholder in Agyapa and therefore will benefit from the receipt of the majority of dividends from Agyapa,” it added
Transparency issues
MIIT further debunked claims that there is a lack of information about cash flows, expenses, and prospectus, saying while the prospectus in connection with the proposed listing was not shared, as
the listing had not commenced, all materials and necessary information were shared with Parliament. It added that this was done so that an educated vote could be made by the Members of Parliament.
It also refuted claims that the SPV is owned by President Nana Akufo-Addo and Gabby Asare Otchere Darko’s friends.
“Currently the company is 100%-owned by MIIF on behalf of the GoG. Once the company is listed on the London Stock Exchange and Ghana Stock Exchange, MIIF will be the largest shareholder, and hence Agyapa Royalties will be ultimately majority-owned by the GoG,” it said, adding that there is no relation between the company and Asaase Radio, as claimed.
In the issues surrounding the change of name, the statement said the company’s original changed from Asaase Royalties upon seeing that the name Asaase is used by 21 other companies some of are part of the mining industrial players and to ensure there is no confusion.
