INSIDE HARMONY HOLDINGS: THE TRUE STORY

By Ismail Bello Several narratives are in circulation about the operations of Kwara State Government-owned Harmony Holding Limited. Here is an inside look at what transpired, based on the review of the handover notes submitted by the Abdulfatah Ahmed administration, and obtained by this writer. Government, according to the notes, established HHL to manage assets that had become drainpipes on its revenue. The Abdulfatah Ahmed administration opted to move the multiple assets into a government holding company to turn the investments into profitability using private-sector style. HHL modelled Odua Investment Ltd of Western Nigeria, Northern Nigeria Development Company (NNDC) bile Holdings of Lagos State and Gateway Holdings of Ogun State model, which are government -owned holding companies in Nigeria.
The Ahmed administration, based on available records, subsequently established HHL as a holding company to handle these various investments with a capital base of N2.5b. However, from the records, KWSG never released the N2.5Billion proposed capitalization to HHL as government could not muster the fund, contrary to an erroneous impression in some quarters. Instead, the notes state that KWSG provided N404million in tranches to cover procurement of fixed assets, renovation and operating expenses.
The handover notes also revealed that a competent board then headed by a renowned Professor, Emir of Ilesha Baruba, His Royal Highness, Alhaji Halidu Abubakar supervised HHL. Accordingly, HHL’s board and management determined the company’s direction, including investment decisions.
KWSG subsequently transferred the following entities to HHL with the government company holding 70 percent equity in each of the entities, according to the records seen by this writer.
  1. HHL Investment and Property Development Company Limited
    (Formerly Kwara Investment and Property Development Company Ltd-active)
  2. Harmony Transport Services Ltd (active)
  3. Kwara Hotel Ltd (active)
  4. Harmony Security Ltd (active)
  5. HHL Insurance Brokers Ltd (Formerly Kwara Insurance Brokers Ltd-Active)
  6. Kwara Waste Management Co. Ltd
  7. Ministry of Finance Incorporated for shares portfolio (Active)
  8. Midway Mineral Development Ltd
  9. Patigi Regatta Motel Ltd
  10. Ilorin Cargo Terminal Company Ltd
  11. Kwara Paper Converter Limited
  12. Satellite Motel Ltd
  13. Kwara Cashew Nut Processing Company Ltd
  14. Kwara Tourism Kitchen Company ltd
  15. International Aviation College (IAC-active)
  16. Harmony Advanced Diagnostic Center(active)
  17. Kwara State Football Academy
    However, KWSG had a minority interest in other companies such as Kwara Mall Development Co. Ltd (20%), Shonga Farms (15%) and Kwara Ethnix Furniture (40%). Only six of the 17 companies were active while the rest dormant because HHL said it could not raise funds for operating them.
    However, HHL failed to communicate its story. Politicians and other commentators field the gap, creating a hostile external operating environment for the company. Despite hostility and the inadequate funding from inception, HHL achieved the following, according to the handover notes.
    i. A cumulative profit of N1.2billion within her first six years of operation.
    ii. HHL remitted to N800m in profits and loans to KWSG coffers within the period under review.
    iii. Payment of N250 million in KWSG obligations to 3rd parties
    iv. Utilization of N250 million on upgrading of Properties transferred to HHL by KWSG
    v. HHL started Light Up Rural Kwara with provision of solar-powered electrification of Lajola in Ilorin East LG resulting in regular power supply from the last two years to date. This is a laudable initiative that the new management should upscale.
    vi. HHL intervention at Kwara Cashew Processing factory in Ogbodoroko, Asa LG in 2016/2017 saved 1200 workers from losing their jobs.
    vii. Remodeling of Adama Bola Saad Building on Amadu Bello Way, Ilorin attracted and kept ISON in Kwara State, leading to the recruitment of 600 youths.
    viii. HHL rescued Kwara Insurance Brokers, slated for liquidation, with the provision of the mandatory N20m recapitalization required by NAICOM.
    ix. Establishment of Harmony Investments and Trust Limited, a finance company with N100million capitalization in 2017
    Another sore point in the public space is the status of properties transferred to HHL. Going by the notes, KWSG transferred properties in Ilorin, Lagos and Kaduna to HHL management in 2014. According to records, HHL did not receive any government assets in Abuja. In the notes, the company maintained that all properties transferred to it are intact. It however admitted selling one property located it Kaduna. HHL said it sold the property due to heightened insecurity in Kaduna in 2014/2015 and miscreants occupying it. The proceeds, according to HHL, went into KWSG coffers. However, KWSG property in Lagos, and Ilorin are intact, according to the handover notes.
    This review of HHL records shows there is nothing sinister about its operations contrary to misconceptions in some quarters. It is also clear from the notes that former Senate President, Dr. Abubakar Bukola Saraki had no financial link or otherwise with the KWSG-owned company. Neither did ex-Governor Abdulfatah Ahmed, whose administration established Harmony Holdings. While HHL have suffered from poor investment choices and management decisions, its establishment remains one of Abdulfatah Ahmed administration’s major legacies. However, the avoidable negative publicity and undue politicization of HHL may have been unhelpful to its operations and profitability.
    With Governor Abdulrahman Abdulrazak’s commendable appointment of a new helmsperson for the holding company, HHL should henceforth operate in a more conducive business environment while insulated from partisanship.
    Bello writes from Ilorin

Leave a Reply

Your email address will not be published. Required fields are marked *