Umuahia, Abia State, Nigeria – April 25, 2025 – The Abia State Government (ABSG) has announced the revocation of the land title granted to the Enyimba Automated Shoe Company (ENASCO) and is moving to reclaim all state government resources and assets invested in the firm. This decisive action follows a comprehensive review by leading professional service firms that uncovered significant discrepancies and corporate governance issues within the shoe manufacturing company.

 

ENASCO, established in 2020 under the previous administration with imported equipment from Turkey and a projected annual production capacity of two million pairs of shoes, aimed to revitalize Abia State’s leather industry.

 

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The state government made substantial contributions to the company, including land, buildings, and equipment valued at an estimated NGN158.3 million, alongside cash injections of NGN41.85 million. These public investments constituted over 70% of the total cash and assets contributed to ENASCO to date.
However, a recent regulatory, financial, and operational review revealed troubling irregularities.

 

Notably, the shareholding structure registered at the Corporate Affairs Commission (CAC) as of November 2024 failed to reflect the Abia State Government as a shareholder or beneficial owner, despite its significant financial and asset contributions. While subsequent changes were made to the shareholding in July 2023, shortly after Governor Alex Otti assumed office, the ABSG remained absent from publicly available CAC records. As of April 3, 2025, the listed shareholders were Nwakile John Chidi, Udeagbala John Chinyelu, Nwaogu Chinenye, Sam Hart, and Macauley Atasie. The government asserts this demonstrates a clear intention to misappropriate state investments.

 

Furthermore, the review highlighted a consistent decline in ENASCO’s revenue, culminating in retained losses of NGN115.7 million by October 2024. The company also heavily relied on shareholder deposits to fund its operations, which swelled to NGN88.9 million during the reviewed period.

The report also pointed to a lack of a Corporate Governance Framework or Board Charter, absence of statutory audits, and non-compliance with tax obligations.

 

Additionally, the government found evidence of NGN97.7 million in shareholder deposits being utilized without proper documentation or expense validation.

 

In response to these findings, the Abia State Government convened a stakeholders’ meeting on April 23, 2025.

 

The primary concern was the absence of ABSG representation in ENASCO’s shareholding and on its Board of Directors, given the substantial public investment. However, existing shareholders reportedly resisted restructuring the shareholding to reflect the state’s contributions or accepting the appointment of government representatives to the board.

 

“The posture of the Company shareholders was not only untenable but ridiculous,” stated a press release issued by the Chief Press Secretary to the Governor, Ctz. Ukoha Njoku Ukoha.

“It is unacceptable that despite the overwhelming financial and asset contributions made by Abia State Government to the Company, the State does not hold a single share in ENASCO.”

 

Consequently, the Abia State Government has issued the following directives:

• Revocation of Land Title: The right over the parcel of land granted to ENASCO is hereby revoked.
• Reclamation of Assets: All assets contributed to the company by the state government, including land, buildings, and equipment, will be reclaimed.
• Legal Action: The government will pursue appropriate legal actions to recover any additional funds or assets misappropriated by the company’s management.

 

The Abia State Government emphasized its commitment to transparency, accountability, and good corporate governance in the management of public assets.

The statement concluded by affirming the government’s dedication to creating a conducive environment for genuine investors and businesses that adhere to the highest standards of integrity and corporate governance, as part of its efforts to revitalize struggling industries within the state.