The Enugu State government has clarified its position regarding the revival of the dormant United Palm Products Ltd (UPPL).
Contrary to circulating reports, the government is not investing N100 billion into the project. Instead, the financial responsibility lies with Pragmatic Palms Ltd, a private firm and the special purpose vehicle (SPV) for the partnership.
Mr. Uche Anichukwu, the senior special adviser to the governor on external relations, issued a statement explaining the deal’s specifics. He stated that Pragmatic Palms Ltd would finance 60% of the transaction value, while the Peter Mbah administration would contribute plantations valued at 40% equity.
Anichukwu highlighted that UPPL, a legacy of the late premier of the defunct Eastern Region, Dr. Michael Okpara, has been inactive for years. The revitalization of such dormant assets aligns with Governor Peter Mbah’s campaign promise to transform the state’s economy from the current $4.4 billion to $30 billion through private sector investments.
The partnership with Pragmatic Palms Ltd., a subsidiary of Diamond Stripes Ltd., was finalized on May 9, 2024, following extensive negotiations and due diligence that began in 2023. Anichukwu explained that the creation of an SPV, Pragmatic Palms Ltd., was necessary due to the involvement of multiple parties/investors, aligning with best international practices.
He further clarified that Diamond Stripes Ltd., a company with over $20 billion worth of investments across various sectors since 2013, provided a guarantee for Pragmatic Palms Ltd. The state’s interests in the N100 billion UPPL deal are well-protected, with performance targets and timelines set for Pragmatic Palms Ltd. Failure to meet these targets could lead to the Enugu State Government revoking the deal and reassuming total ownership of UPPL.
Moreover, the Enugu State Government holds representation on the company’s board, including the Chairmanship, ensuring the state’s interests are well represented and protected.
