- Park Agrotech Ghana Limited is expected to inject $28 million into the factory between 2020 and 2023.
- The Ghana-based company is a subsidiary of the Skylark Group of Companies of India
- The government in 2016 secured a US$35 million EXIM Bank facility to set up the factory, while a US$24 million facility was also set aside to support out-grower farmers.
- Park Agrotech Ghana Limited is expected to invest $11 million of the amount into sugarcane cultivation, $6 million to upgrade plant and machinery and $11 million as working capital
The Komenda Sugar Factory which has been non-operational for years will soon be operational, the Minister of Trade and Industry, Mr Alan Kyeremeten, has assured Ghanaians.
He said the new investor of the company, Park Agrotech Limited would begin a comprehensive programme of action to bring the factory to life as soon as restrictions on all foreign travels from the COVID-19 pandemic is lifted and all relevant approvals have been secured.
The minister gave this assurance when he appeared before Parliament to answer some questions on the status of the factory.
Park Agrotech, which emerged as the successful bidder after a rigorous selection process conducted by the accounting and advisory firm, PricewaterhouseCoopers (PwC), is expected to invest $11 million of the amount into sugarcane cultivation, $6 million to upgrade plant and machinery and $11 million as working capital to bring the ailing factory back on its feet.
He said the government had signed an agreement with Park Agrotech Ghana Limited, a company incorporated in Ghana and operating in the agribusiness sector to start operating the factory,
Under the Agreement, Park Agrotech Ghana Limited will invest US$ 28 million over the first three years in capital expenditure and working capital including paying an annual concession fee of US$3.3 million for a period of fifteen years.
He said the agreement was signed after a successful completion of the bid evaluation process by the transaction advisor and a recommendation made for the consideration by the Ministry and Cabinet after identification of a strategic investor with the requisite technical and financial capacity to operate the factory efficiently and profitably.
He said the company would be working in partnership with STM Projects Limited, an Indian based company with an extensive experience in the management and operations of sugar mills and plantations in both India and other parts of the world.
He said the Agreement would be effective upon completion of conditions precedent which will include the approval by Parliament which documentation will be brought to the House in due course.
The Minister said it was agreed during the final negotiations that the implementation of the project be delayed until the finalisation of the National Sugar Policy intended to provide the strategic policy framework for the implementation of the project.
He said the approval of the Sugar policy by Cabinet in October 2019 after a series of extensive consultations in October last year paved the way for the concessionaire to be formally introduced to the chiefs and elders of the Komenda Traditional Area in November 2019.