The Social Security and National Insurance Trust (SSNIT) has justified its decision to sell 60% stake in its four hotels to Rock City Hotel Limited.
This clarification comes after several misinformation and misrepresentation of facts in regards to the sale of the insurance scheme’s four hotels which has become a controversial issue being discussed by many in the country.
Kofi Bosompem Osafo-Maafo, the Director General of SSNIT during a press conference on Monday, July 8 indicated that all four hotels have recorded continuous losses and do not pay dividend.
“I don’t think anyone running an investment funding in the world would be sitting and earning substandard returns. we have to address the issue. We’ve been through quite a lengthy process to do so. Bear in mind, we’ve also tried having external management companies running the SSNIT hotels and that hasn’t resolved the problem either.
“So, for us, we look at it two-fold, that we are looking to resolve a problem and do so with the introduction of a strategic investor and we outlined the reasons there.”
“Consistent losses by almost all of our hotels. I know you are aware that Labadi doesn’t make a profit, but the returns are below [par]. They haven’t paid us any dividends with the exception of Labadi. Labadi Beach Resort only started paying dividends for the last 2 years. They haven’t from inception,” he explained.
However, Mr.Osafo-Maafo revealed that, Rock City Hotel submitted the best, strongest technical and financial proposal amongst those received, thus, best bidder for all Lots, choosing Lot 1 which is made up of La Palm Royal Beach and Labadi Beach Hotel, where as Lot 2 comprising of Ridge Royal Hotel and Elmina Beach Resort as their preferred lots.
“The total bid by Rock City for the four hotels was above the valuation placed on the hotels. Rock City Hotel’s bid offer for Lot 1 (Labadi Beach Hotel, and La Palm Royal) was more than the combined bids of the other two bidders. It was also more than the price of recent investment valuation for 60% shares in the hotels”, he stated.
Mr. Osafo-Marfo further noted that Rock City’s bid exceeded the valuation recommended by the
Independent Transaction Advisor, ensuring SSNIT received a fair market price although the negotiation not been concluded yet.
