An amount of US$2 million Ghana paid in 2019 as premium to acquire ordinary shares for the development of the Accra Sky Train Project has been reported as a net liability.
This is contained in a report by the Auditor General on the Public Accounts of Ghana’s Public Boards, Corporations and other Statutory Institutions for the period ended December 31, 2021.
In the report, it emerged that Africa Investor Holdings Limited incorporated a Special Purpose Vehicle (SPV) in Mauritius for the purposes of establishing Ghana Sky Train Limited, to develop the Accra Sky Train Project through a concession on Design, Build, Finance and Operate arrangement.
According to the Auditor General’s report, the Government of Ghana through the Ghana Infrastructure Investment Fund paid US$2 million to Africa Investor Holdings Limited as full consideration for 10 ordinary shares at US$1.00 per share in Ai Sky Train Consortium Holdings (the SPV).
Thus, the premium paid for each share was US$199,999.
The SPV has reported a net liability on 31 December 2020.
Ai Sky Train Consortium Holdings is yet to obtain the licence for ‘Aeromovel Technology’, required for the Sky Train Project.
Feasibility studies that will better inform the project economics and required approvals from the Cabinet of Ghana and the Parliament of Ghana are still ongoing.
The Auditor General noted that the investment in the SPV could not be recovered if the Accra Sky Train Project is unable to secure the licencing, and the Executive and Parliamentary approvals.
“We urged Management to continue to monitor the feasibility and the recoverability of the investment in the SPV and make the necessary provisions based on the outcome of the feasibility studies. Management noted the recommendation for compliance”, the audit report recommended.
Background
The government signed the Concession Agreement for the construction on the Accra SkyTrain Project in November 2019.
The proposed initiative in Accra was to provide for the development of five routes, four of which were to be comprised of radial routes that would have originated at the proposed SkyTrain Terminal, at the heart of Accra, at a newly developed Kwame Nkrumah circle, and one route that would have provided an intra-city commuter loop distribution service.
