Agyapa Royalties suspension will boost investor confidence
The suspension of the Agyapa Royalties transaction, pending a corruption risk assessment by the Office of the Special Prosecutor, will be a confidence booster for the country’s prospects on the international capital market, chairman of Parliament’s Finance Committee, Dr. Mark Assibey-Yeboah, has said.
In an October 1 letter to the Special Prosecutor (SP), Charles Adu Boahen, a deputy finance minister, said the government had put the planned Initial Public Offer (IPO) of Agyapa on hold and would await the SP’s green light before proceeding.
This followed the SP’s decision to conduct a corruption risk assessment on the controversial transaction, through which the government is seeking to monetise the country’s gold royalties to raise equity funds on the London and Ghana Stock Exchanges.
According to Dr. Assibey-Yeboah, the grounds for halting the process are logical.
“You should hasten slowly given that the OSP has written to the Finance Ministry. Let’s pull the brakes so that the OSP concludes the corruption risk assessment; then we can move forward,” he said.
“In any event, that can be a confident booster to investors, Ghanaians and to everyone connected to the transaction; so I think it is a step in the right direction,” he told Business24 in an interview at Parliament House on Tuesday.
Dr. Assibey-Yeboah added that he would be surprised if the OSP found something wrong with the deal, given the thorough work done on it.
The government wants to take advantage of gold’s strong price performance this year to raise at least US$500m from the IPO.
Both the opposition National Democratic Congress and civil society groups have raised questions about the transaction, including the basis for valuing the gold royalties assigned to Agyapa and the company’s registration in Jersey, an offshore British tax haven.
In response, the government has said the company would comply with international corporate governance standards, including the strict rules of the London Stock Exchange, where Agyapa would be primarily listed.