SSNIT: Hotels No More For Sale

“The Board and Management of Social Security and National Insurance Trust (SSNIT) wish to inform the public that the process to divest 60% of SSNIT’s stake in the hotels has been terminated”, a statement released in Accra on Friday July 12, 2024 and signed by Elizabeth Akua Ohene, Chairperson of SSNIT Board of Trustees, noted.

The statement, issued on SSNIT’s letter head noted further: “We wish to assure pensioners, contributors and the public of our commitment to managing the affairs of the Trust prudently for the sustainability of the Pension Scheme.”

This brings to a possible end the never-ending controversies that have enveloped the proposed sale of 60% of SSNIT’s shares in some six hotels to a strategic investor on the grounds that the said hotels had become white elephants running at a loss.

Organised Labour has asked workers across the country to stay home and not report for work from today Monday July 15, if SSNIT does not discontinue the sale of shares negotiations.

Just an hour or so before SSNIT issued the statement last Friday, the said strategic investor, Rock City, which won the international bid for the sale of the shares in the hotels in question, had officially written to SSNIT to withdraw its bid and state its loss of interest in the venture.

Rock City addressed its letter to Kofi Osafo-Maafo, Director General of SSNIT and stated reason for which it was withdrawing its bid.

The said letter noted:

12th July, 2024.

The Director-General,

Social Security &National Insurance Trust (SSNIT),

Pension House, Accra

ATTENTION: MR KOFI OSAFO-MAAFO

Dear Director General,

NOTICE OF WITHDRAWAL OF BID

At all material mites, we believed that we had participated in an internationally competitive bid and were happy to have learned of our success having edged out the 15 other organisations that participated in the process.

It therefore came as a total surprise to us that some of your stakeholders have raised concerns about your decision to seek strategic partners for these hotels.

We have also taken note of ongoing media discussions on your decision to seek strategic investors for these hotels.

We have also taken note of your recent media engagements and press statements ostensibly defending your decision to seek to a strategic investor.

Flowing from all the commentary monitored and the undue negativity that has attended this commentary, we feel you have not done enough to engage all your stakeholders, leading to perceptions that we don’t want associated with our brand. We believe that such negativity is not only injurious to our brand but also jeopardises the success of the investment we intend to make in these hotels.

Therefore,  we era writing to inform you of our decision to withdraw our bid and discontinue our pursuit of this investment opportunity.

Finally, in the interest of accountability and transparency, we consent to you releasing all or whatever parts of our bid documents for public scrutiny or publish same if it should become necessary.

We wish you continuous success in your endeavours.

Thank you.

SIGNED

For. Rock City Hotel.

 Meanwhile, SSNIT, in a previous press conference explained that it decided to consider only the sale option in its efforts to intervene in its hotel investment portfolio due to: consistent losses across almost all the hotels, non-payment of dividends with the exception of Labadi Beach Hostel but their returns have been low, inability to service debts owed to SSNIT, calls on SSNIT to fund maintenance, operational activities and employee emoluments, and the necessity for regular significant capital injections to effectively operate the hotels.

“If you look at these hotels they are capital intensive businesses, they require periodic heavy and continuous capital expenditure and SSNIT does not have the funding to do that.

“The businesses have been making consistent loses, and if we have business that by and large are yielding us returns that are below what we find acceptable, even if they are profitable, we will look to divert the stake to deploy elsewhere.”

“We have also tried having external management companies running the said SSNIT hostels and that has not resolved the problem”, Kofi Osafo-Maafo, the Director General told journalists at the said briefing.