Abia Hotels Takeover: Govt Insists Due Process Was Followed After ₦450m Compensation
The Abia State Government has defended its sealing and takeover of Abia Hotels, insisting that the action followed full due process, was legally justified, and came only after the investor managing the facility—Investment Guarantee Limited—received ₦450 million in compensation.
At a media briefing in Umuahia, the General Manager, Umuahia Capital Development Authority (UCDA), Mr Kingsley Agomoh, described the takeover as the culmination of a long-running engagement, repeated warnings, breached obligations, and failed commitments under the Memorandum of Understanding (MoU) that governed the hotel’s concession.
According to Agomoh, the government began engaging the investor and its Managing Director, Mr Randy Ukawoke, as far back as 2024 to address compliance concerns and the persistent failure to upgrade the hotel to the agreed standard.
“There were more than ten engagements. He submitted an evaluation report, he nominated a lawyer, negotiations were concluded, and eventually he was paid ₦450 million,” Agomoh stated.
The GM stressed that despite receiving compensation and being given a deadline to vacate the premises, the investor refused to leave and continued to run the facility illegally, prompting the sealing of the hotel.
A Breakdown of the Govt’s Position: Breach, Compensation, Non-Compliance
Agomoh outlined several specific breaches of the MoU:
1. Failure to Upgrade Abia Hotels to a Three-Star Standard
The investor reportedly failed to meet the central requirement of the agreement—transforming Abia Hotels into a modern three-star facility capable of attracting new investments and boosting tourism in the state.
2. Failure to Submit Designs and Approval Plans
The government also faulted the investor for failing to submit drawings, upgrade plans, or any official documentation to relevant agencies—another clear breach of contractual obligations.
3. Continued Operation After Compensation
Despite receiving ₦450 million, the company did not vacate the premises, a development officials say forced the government’s hand.
Agomoh added that the investor’s claim of being forced out was “false and misleading,” maintaining that the government acted with “human face,” particularly because the investor is an Abia indigene.
The Media Adviser’s Angle: ‘Attempt to Conceal Other Investors’ Interests’
Also speaking on the matter, the Special Adviser to the Governor on Media and Publicity, Ferdinand Ekeoma, accused the lessee of attempting to hide the financial compensation from other investors involved in the project.
“Somebody tried to present two accounts so the other investors would not know about the compensation. The public needs the truth,” Ekeoma said.
This allegation deepens the complexity of the dispute, hinting at possible governance lapses within the investor group.
The Investor Fights Back: Petition to Police, DSS
In a swift response, Abia Hotels Limited filed petitions to both the Abia State Commissioner of Police and the Department of State Services (DSS) on November 15, describing the shutdown as:
- unlawful,
- in violation of existing court orders,
- disruptive to business operations, and
- a direct threat to employees’ livelihoods.
The petition, signed by Managing Director Dr Patrick Ezenwaka, argues that the government acted prematurely and without sufficient legal basis.
This sets the stage for what may become a prolonged legal and commercial battle, touching on themes of investor confidence, state-asset reform, contract sanctity, and governance transparency.
BRANDECONOMY Analysis: What This Means for Business, Investors & Subnational Governance
The Abia Hotels dispute is more than a disagreement over a concession—it reflects the broader tension shaping Nigeria’s subnational investment climate.
1. The Imperative of Contract Discipline
States increasingly rely on public-private partnerships for infrastructure revitalisation. The integrity of MoUs and concession agreements is now fundamental to investor confidence.
2. The Thin Line Between Enforcement and Overreach
While the government insists due process was fully observed, the investor cites alleged court orders and operational disruption. The courts will ultimately have to determine whether the balance of justice favours enforcement or restraint.
3. Reputation Risk for Both Sides
For the government, the optics of sealing a major hotel could raise investor caution. For the investor, accusations of concealment, breach, and non-performance weaken its credibility.
4. Subnational Asset Management in the Spotlight
This case adds to a growing list of state-owned asset disputes that underscore the need for transparent frameworks, predictable processes, and improved oversight in public asset management.
This story—and the legal proceedings to follow—will shape the next chapter of investment governance in Abia State.
