No Legal Cancellation of Kwara Hotel Concession Agreement- Crystal Group

The Management of Crystal Group has threatened to sue Kwara State Government for breach of contract over remodeling and concession of Kwara Hotel Ilorin.

Crystal House Management in a letter addressed to Kwara State Governor, AbdulRahman AbdulRazaq and made available to newsmen in Ilorin on Monday, gives the state government to rescind its decision of awarding the same contract to another company, Craneburg Construction Company.

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In a letter dated 28th December 2023, which was received by the Kwara State Government on 2nd January 2024, the Counsel to Crystal Group of Companies, GMO Legal, George Oguntade issued a 7-day ultimatum to the Kwara State Government to cancel the purported contract awarded to Craneburg Construction Company for the remodelling and rehabilitation of Kwara Hotels Limited or face legal action. The company also copied Speaker Kwara State House of Assembly, Managing Director of Harmony Holdings and State Director of DSS in their letter.

Kwara Hotel

Recall that the State Government had earlier granted the Fix and Operate Concession of Kwara Hotels to Crystal Group of Companies. The approval of the State Executive Council was conveyed to the company by the Group Managing Director/CEO of Harmony Holdings Ltd., Abdullahi Abdulmajeed, in a letter dated June 2, 2022.

According to the letter, the Terms of Engagement include the commitment of the sum of N3 billion by Crystal Group of Companies for the renovation and management of the hotel; the payment of concession fees for the 1st five years; and revenue profit sharing for the subsequent years, amongst other things.

The Kwara State House of Assembly, having received a copy of the State Executive Council’s approval for the Concession of Kwara Hotels to Crystal Group of Companies, deliberated on the issue on the floor of the House and passed a resolution approving the concession arrangement.

In a dramatic turn of events, the Kwara State government re-awarded the same contract to Craneburg Construction Company for the sum of N17.8 billion without legally revoking its concession approval to Crystal Group of Companies.

According to a letter addressed to Kwara State Governor, AbdulRahman AbdulRazaq, and signed by George M. Oguntade SAN, the Lead Counsel to Crystal Group of Companies, neither the Commissioner for Business Innovation and Technology nor Harmony Holdings Ltd., informed their client on behalf of the state government that the proposed Concession Agreement had been cancelled or revoked in any manner.

“Our client is utterly shocked at this state of affairs given the huge cost it has incurred not only in meeting the onerous conditions for the award of the concession but also in assembling a team of professionals in anticipation of the commencement of the project,” the letter stated.

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