Umuahia- The Abia State Government (ABSG) has revoked the land title granted to Enyimba Automated Shoe Company (ENASCO) and initiated the recovery of all state-owned assets invested in the firm, following revelations of financial mismanagement, corporate governance breaches, and an alleged scheme to exclude the government from ownership despite its substantial contributions.
The decision was formally announced in a press release signed by the Chief Press Secretary to the Governor, Ukoha Njoku Ukoha, after an exhaustive review conducted by one of the world’s leading professional services firms, which uncovered a litany of irregularities in ENASCO’s operations.
The audit revealed that despite the Abia State Government contributing over 70% of the company’s total assets—including land, buildings, and equipment valued at N158.3 million, as well as cash injections totalling N41.8 million, the state was inexplicably omitted from the official shareholding records filed with the Corporate Affairs Commission (CAC).
This glaring omission, described by government officials as a deliberate attempt to sideline the state, has raised serious questions about transparency and accountability in the management of public-private ventures.
ENASCO was established in 2020 under the administration of former Governor Okezie Ikpeazu as a flagship industrial project designed to revolutionise Abia’s leather and footwear industry. Equipped with state-of-the-art machinery imported from Turkey, the company was projected to produce up to two million pairs of shoes annually, creating jobs and stimulating economic growth.
However, the recent audit paints a starkly different picture, revealing a company in financial distress, with retained losses ballooning to N115.7 million by October 2024. The review also found that ENASCO had become heavily dependent on shareholder deposit, which grew to N88.9 million, sustain its operations, while a staggering N97.7 million in expenditures lacked proper documentation or justification.
Perhaps the most alarming discovery was the discrepancy in ENASCO’s ownership structure. Despite the Abia State Government’s significant investment, the CAC records as of April 2025 listed only private individuals as shareholders, including Nwakile John Chidi (445,900 shares), Udeagbala John Chinyelu (219,600 shares), and three others, with no acknowledgment of the state’s contributions. A subsequent adjustment to the shareholding in July 2023, shortly after Governor Alex Otti assumed office, still failed to rectify the omission, deepening suspicions of an orchestrated effort to deny the government its rightful stake in the company.
In a bid to resolve the dispute amicably, the state government convened a high-stakes stakeholders’ meeting on April 23, 2025, where it demanded an immediate restructuring of ENASCO’s ownership to reflect its investments and the appointment of its representatives to the board of directors. However, the meeting ended in deadlock, with the private shareholders reportedly refusing to accommodate the government’s demands. This defiant stance, described by officials as “untenable and ridiculous,” left the state with no choice but to take drastic measures to safeguard public funds.
“It is inconceivable that after committing such enormous public resources to this venture, the Abia State Government holds not a single share in ENASCO,” the government’s statement read. “This is not just a breach of trust; it is an outright attempt to misappropriate assets that belong to the people of Abia.”
In response, the government has moved swiftly to reclaim what it describes as a “brazenly mismanaged” enterprise. The measures include the immediate revocation of ENASCO’s land title, the recovery of all state-contributed assets—including buildings and machinery—and the initiation of legal proceedings to recover any additional funds that may have been misused. The government has also vowed to scrutinise other public-private partnerships to ensure compliance with corporate governance standards.
The fallout from this decision is expected to be far-reaching, with potential legal battles on the horizon as the affected shareholders may challenge the state’s actions. Meanwhile, the controversy has reignited debates about the effectiveness of public-private partnerships in Nigeria, particularly in cases where government investments are not adequately protected.
Governor Alex Otti’s administration has emphasised that this move is part of a broader agenda to restore accountability in the management of public resources while fostering an environment conducive to genuine investment. “Abia State will only collaborate with partners who adhere to the highest standards of integrity and transparency,” the statement concluded. “We remain committed to reviving moribund industries, but not at the expense of the public interest.”
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