President Nana Addo Dankwa Akufo-Addo has given the Ghana National Gas Company Limited (Ghana Gas) the green light to acquire the Ghana Cylinder Manufacturing Company.
The acquisition of the company will help it acquire the necessary resources to run efficiently.
This was captured in a letter the Presidency wrote to the Managing Director of the Ghana Cylinder Manufacturing Company Limited and sighted by Citi News.
The letter signed by Nana Bediatuo Asante, Secretary to the President, on behalf of President Akufo-Addo was dated April 18, 2023.
“With reference to your correspondence dated 24th March 2023, bearing on the above-mentioned subject matter, I write to inform you that the President of the Republic has granted approval for the acquisition of Ghana Cylinder Manufacturing Company Limited (GCMC) by the Ghana National Gas Company (GNGC),” parts of the letter read.
The cylinder manufacturing company which has been in existence for over 20 years has been struggling to run efficiently for years due to alleged mismanagement by previous managers.
The 2020 Report on State-Owned Enterprises in Ghana captured the Ghana Cylinder Manufacturing Company as one of the lowest-performing entities.
The GCMC, which hitherto was incorporated as a Private Limited Liability under the Companies Code, 1963 (ACT 179) in 1998, is currently 100 percent fully owned by the State.
It was established to promote wider usage of Liquefied Petroleum Gas (LPG) as a substitute for charcoal and firewood, and thereby curtail some of Ghana’s environmental challenges of degradation, deforestation and desertification caused by excessive use of firewood.
According to the 2020 report issued by the Ministry of Finance, GCMC recorded a net loss of GH¢4.06 million for the 2020 financial year.
“This represents a 21.77 percent decrease from the net loss of GH¢5.19 million recorded for FY2019. Net profit margin was negative 37.75 percent, which represents an improvement of 120 percentage points from negative158.47 percent recorded in FY2019,” the Finance Ministry added in the report.
“GCMC’s liquidity position further declined. Current ratios were 0.55 and 0.08 for FY2019 and FY2020, respectively, indicating that the Company faces significant challenges covering its short-term obligations”.
Ghana Cylinder Manufacturing Company gets new MD
President Nana Addo Dankwa Akufo-Addo in February 2023 nominated a new Managing Director for the Ghana Cylinder Manufacturing Company Limited.
This followed the resignation of the former MD, Frances Awurabena Essiam.