19.04.2005 Business & Finance

United Rail Has Met All Criteria Set - DIC

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THE Divestiture Implementation Committee (DIC) has stated categorically that United Rail, the company selected to take up the rehabilitation and management of the country's railway sector, meets the criteria set by the government.

It said United Rail was able to meet all the criteria set by the committee, while the necessary due diligence conducted on the company proved positive. “It is capable of rehabilitating and managing the sector,” it concluded.

Mr J.K.A. Wiredu, the acting Executive Secretary of the DIC, who said this in an interview, made it clear that the company met the financial and technical conditions required for the operation of the railway sector.

Some media houses in the country have, over the last couple of months, continuously described United Rail as a non-existent company which is coming in to milk the Ghana government.

Mr Wiredu explained that United Rail was selected based on its technical and financial proposals, as well as its business plan for railway services, and noted that it was able to score more than 80 per cent to qualify for the contract.

He said United Rail was a consortium made up of Trackbed, which is the financier, Railroad Development Corporation of the USA as the management consultants and Holdtrade which has been working on the rehabilitation of the Western rail line for more than 10 years.

He said the process of selection involved an inter-ministerial committee made up of the ministries of Harbours and Railways and Finance, together with the railway management and union, while the DIC supervised the process.

Mr Wiredu said the process of selection was also closely monitored by the World Bank, CPCS Transocn of Canada, which teamed up with a Ghanaian firm, Kofi Bucknor and Associates and General Law Consult, to provide advisory services.

He said the motive for this broad monitoring process was to ensure that the process was transparent to satisfy all the parties that submitted bid proposals or showed interest in the railway sector.

Mr Wiredu described as unfortunate the turn of events regarding the doubt cast on the genuineness of United Rail and gave the assurance that the committee had done its best to do the necessary checks and was confident that United Rail existed.

On the filing for bankruptcy by United Rail, he vehemently denied the allegation and indicated that the companies forming the consortium were financially sound.

Mr Emmanuel Opoku, the Managing Director of Ghana Railway Company (GRC), on his part, confirmed that Holdtrade had been working in the country for the past 10 years.

He outlined some of the projects that the company had undertaken as the rehabilitation of the Henschel locomotives, a project financed by the World Bank, the supply of 90 mineral wagons, track maintenance and upgrading, as well as locomotive maintenance, financed by the GRC, and the rehabilitation of 36 coaches and the supply of breakdown crane which were financed by the German and Japanese governments respectively.

In addition, he said Holdtrade had been involved in the supply of wagon spare parts, track materials, that is, rails and steel slippers, foundry coke and rail vehicles, at a time when normal lines of credit to GRC had not been available.

“I, therefore, have confidence in that company and the other members of the consortium because one of the companies has a very good track record,” he added.

When reached on phone at his London base, Mr Martin Burrow, the Director of United Rail International, noted that the company was registered in the UK last year and explained that United Rail Ghana was formed as a subsidiary, as required by the DIC.

“United Rail is the name for the consortium, which is made up of Trackbed, the financiers, Railroad Development Company and Holdtrade, which already has a a lot of experience when it comes to railways because it has been working in the country for the past 10 years,” he said.

“We have a lot of confidence in Trackbed as a financier because it has what it takes to finance the project,” he said.

Asked whether the comments about United Rail could have an effect on the negotiations, he replied in the affirmative, explaining that the financiers were not happy with the turn of events in the country.

He said if care was not taken, the company could pull out and invest in other countries.

Mr Burrow, however, gave the assurance that the United Rail team would visit Ghana by the weekend to continue with negotiations with their counterparts from the government side.

He said with the experience of Holdtrade in the country, there was enough knowledge about the Ghanaian railway system and considering the calibre of personnel that GRC had, more motivation and assistance would revive them to give of their best when the consortium demanded them to work.

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