ACCRA, GHANA - In an unexpected turn of events, members of parliament were recalled for an emergency session Tuesday to debate the sale and purchase agreement covering Vodafone's acquisition of 70 per cent of the shares of Ghana's telecom provider.
The deal has come under fire from opposition politicians. Minority members of the parliamentary select committee for telecommunication objected to the 999-year time-span of the deal as well as the government's plan to transfer its fiber-optic backbone to Ghana Telecom, in effect transferring it to Vodafone's control. There are also questions about whether the agreement truly commits Vodafone to make a referenced US$500 million investment in the telecom over a period of four years.
The committee's ranking minority member, Haruna Iddrisu, told IDG News Service that he doubts parliament will approve the agreement Tuesday.
A group calling itself the concerned citizens of Ghana led by a lawyer and former presidential hopeful, Bright Akwetey, filed suit against the government Monday for selling the majority stake in Ghana Telecom. The group hopes to prevent the sale of the shares as they believe the stake is worth more than $900 million.
The group believes the government did not take a lot of issues into consideration before signing an agreement with Vodafone. But minister of finance and economic planning Kwadwo Baah-Wiredu last week challenged any person with a better option to salvage the financially ailing company to present their idea within 24 hours.
At a press conference in Accra in July, Minister of Communication Benjamin Aggrey Ntim said the telco's $1.3 billion assets are outweighed by its liabilities. This situation, the Minister said, "is rapidly leading to GT's insolvency and a total collapse if no drastic action is taken."
Aggrey Ntim observed that the current financials of Ghana Telecom gave cause for alarm and required the injection of capital within the shortest possible time to salvage the company. He also defended "the aggregation of other state communications infrastructure that also required investment to build"
Meanwhile, some Ghana Telecom workers demonstrated Monday, urging the government and Parliament to speed up the process of approving the deal lest the company collapse and cost 4,200 jobs.
It is expected that shares of Ghana Telecom would be offered on the Ghanaian stock market in 2010.