Umuahia-based Golden Guinea whose doors have been shut for nearly 16 years is yet to resume production as was expected in 2016.
The troubles of the once pride of the Eastern States goes back to 2003 when fire broke out at the facility destroying equipment including boilers. But even before then, there had been allegations of mismanagement, fraud, and insolvency by the management. Successive state governments made efforts to resuscitate the once pride of Umuahia. The previous administration of Governor T.A. Orji set up a committee to look into how to bring back the brewery to life. Work to revamp the facility started in his administration.
The Government of Abia State under current Governor Okezie Ikpeazu has set as part of its economic policies to resuscitate moribund industries in the state such as Golden Guinea.
The brewing company whose commissioning dates back to the early 1960s was founded by then Premier of the Eastern Region, Dr. Michael Okpara. Production started in 1963 with an annual capacity of one million gallons. The firm introduced Eagle Stout in 1967 but production was hampered by the outbreak of the civil war from 1967 to 1970. After the war, the company went through some extensive retooling in 1975 and an extension was built by the German firm Coutinho Caro which later participated in an equity offering issued by the firm.
However, production at the brewery was cut short by the 2003 fire. The brewery holds licensing agreements to produce and market Golden Guinea Lager, Bergedorf Premium Lager, and Bergedorf Malta all from Holsten Brauerei AG of Hamburg, Germany.
According to Sam Hart, a Senior Special Assistant to Abia State Governor on Public Communications, he commented in April that majority shares in the company were later purchased by Pan Martine Investments Limited, an indigenous company run by Mr. Okey Nzenwa from Mbaise in Imo State.
The new owners went about to restore the ailing company, replacing the burnt boilers and installed entirely new production line.
However, due to the recession of 2015 through 2016, the skyrocketing cost of the dollar made it difficult for the company to complete the needed retooling, thereby affecting the projected resumption timelines.
The company needed more funds to complete the retooling works and because of its existing debt exposures, lenders were wary. Work on the site came to a stop.
According to the Governor’s Public spokesperson, this was when the Governor stepped in, with his drive to resuscitate all moribund industries in Abia State irrespective of ownership.
The Governor was able to attract the attention of the Federal Government and it’s lending institutions which granted the owners of Golden Guinea Breweries ₦3.6bn ($10m) loan facility through the Nigerian Export-Import Bank (NEXIM), while the Bank of Industry provided assistance with an Economic Revival Facility.
The new funds is said to have given a new lease of life to the company and installation work has resumed at the facility.
According to the spokesperson for the Governor’s Office, Golden Guinea Breweries plc should reopen to the public within a few months, barring new untoward developments.
But listening to the Governor in March respond to a journalist question concerning the state of the moribund industries, including Golden Guinea, the Governor said he “is like a helpless bystander.”
“I am like an Israelite, whose Ark is falling and I am forbidden from touching the Ark,” he said.
Explaining his handicap and efforts he has made since resuming office more than two years ago to revive the ailing industries, he said the problem was that the factories were handed over to people who lacked financial abilities to resuscitate them, adding that the country’s economic situation, whereby exchange rate shot up drastically didn’t help matters.
“Golden Guinea is in the hands of somebody. It has become a personal enterprise. We provided security and accommodation for the German engineers that came to rebuild it. I was virtually pampering them and spent close to 30 minutes daily with them at the factory,” said the Governor.
Sometime in 2017, they assured me that I was going to enjoy Golden Guinea beer in December 2017, but that was not to be.
The company said, “dollar and exchange rate and what have you couldn’t let them get raw materials and they asked me to get help through the Vice President, so they could seek assistance from Bank of Industry and I did”.
However, the good news is that they recently called me to say that our effort with the Bank of Industry is yielding result,” he said.
Sources say that Golden Guinea was facing financial difficulties before the 2003 fire outbreak and took loans from some individuals, who are the current owners when the company was unable to pay the loan.
This article appeared first in Beverage Industry News.