A review of Vodafone's purchase of Telecom Ghana has concluded that the sale was not beneficial to the Ghanaian state. The sale was opposed by the opposition politicians, who now form the current government, and they ordered an enquiry into the sale by the previous government.
The review, carried out by an Inter-Ministerial Review Committee has recommended that the government find a way of renegotiating the sale, which was completed in August 2008.
Although the sale of 70% of the company was was for a headline figure of US$900 million on a debt-free, cash-free basis, the review claimed that just US$267.6 million from the sale due to "complicated financial arrangements", and that the sale might be illegal in Ghana due as it was managed through a Dutch holding company.
The Committee noted that Telekom SA had offered US$947 million for the lower stake of 66.67%.
Complicating the investigation, the former Minister of State for Finance Dr. Akoto Osei and the immediate past Chief Executive of Ghana Telecom, Dickson Oduro Nyaning refused to assist the Committee with information. In addition, it criticized the former President, John Kufuor, for interfering in the transaction, describing his action as "highly irregular, unconventional and did not rely on expert advice".
Although the Committee heard testimony that various politicians had been bribed to vote in favour of the sale, it felt that it lacked the resources to investigate the criminal allegations. The review also criticized a clause in the transaction that prevented the government from bringing corruption charges against any member of the enlarged Telecom Ghana company.
The Committee said, that despite several requests, Vodafone could not provide information to enable the Committee confirm the expected US$200 million capital injected into Ghana Telecom after the sale.
While Vodafone claimed that, between August 2008 and May 2009, it paid Huawei GH¢61 million (US$42 million) from the bridge facility, documents submitted by Huawei indicated that they had invoiced and received only GH¢37.29 million and not GH¢61million. The Committee considered it a breach of the warranty provisions in the SPA. The Committee was of the view that Government may want to confront Vodafone and ask them to account for the difference of GH¢23.71 million.
The government is to make a decision on how to proceed within a couple of weeks. Vodafone said that it couldn't comment until it received a copy of the report.