Wednesday , November 29 2023
Ecobank Writes FirstBank over Otudeko

Ecobank Writes FirstBank over Otudeko

Last week’s acquisition of a major equity stake in FBN Holdings by the Otudekos has stirred more controversies with a judgment creditor alleging that the acquisition was a clever ploy to divert funds and frustrate payment of about N14 billion debt.

In a letter addressed to FBN Holdings Plc through its lawyer, ‘Kunle Ogunba & Associates, Ecobank Nigeria Limited called on FBN Holdings to stay action and not accord any rights to the acquired shares.

It alleged that the share purchase was a ploy by Mr. Oba Otudeko to frustrate a Supreme Court judgment in the bank’s favour.

Ecobank Nigeria, a member of Ecobank Transnational Incorporated (ETI) Plc, which is also quoted on the Nigerian Exchange (NGX), stated that the Supreme Court had in its judgment on January 27, 2023, in Appeal No SC/CV/210/2021 affirmed the indebtedness of several companies related to Otudeko and ordered the companies to pay their indebtedness to the bank.

The total indebtedness was calculated at N13.51 billion as of January 31, 2023.

The related companies included Honeywell Group Limited, Siloam Global Services Limited, Anchorage Leisures Limited, Honeywell Flour Mills Plc and Dr. Oba Otudeko.

Ecobank alleged that Barbican Capital, which last week acquired 13.3 per cent or 4.77 billion shares in FBN Holdings, was “hurriedly incorporated after the judgment of the Supreme Court, specifically on the 9th day of March 2023, as part of active steps by Otudeko to divert his personal funds and assets, and those of the debtor companies away from paying the judgment sum.”

The bank alleged that Otudeko, who has a beneficial interest in the companies, personally guaranteed the loans in question.

Barbican Capital has Otudeko’s children – Oyeleye Foluke and Otudeko Obafemi Adedamola – as main owners.

Obafemi Otudeko is the Managing Director of Honeywell Group Limited and is also a non-executive director of Anchorage Leisures Ltd.

Oyeleye sits on the board of NGX Regulation Limited, the self-regulatory organisation (SRO) for the NGX, where FBN Holdings, ETI and Honeywell Flour Mills are quoted.

“Consequent upon the foregoing crystalised facts, it is beyond doubt that the actions being taken by Dr. Oba Otudeko are targeted at diverting his assets and that of the Honeywell Group of companies through the said Barbican Capital Limited, in order to frustrate the enforcement of the judgment of the Supreme Court against him and the Honeywell companies, towards recovering his/their undisputed indebtedness to our client.

“We, therefore, demand that you respectfully stay/reject the approval/consent/registration/ratification, howsoever described and in whatever manner, of the shares bought by the said Barbican Capital Limited held via the afforested entities.

“Proceeding with such approval/registration will be tantamount to assisting in the diversion of funds and assets meant for the payment of the debt which has been affirmed by the Supreme Court, same being a flagrant violation of the extant judgment of the Supreme Court and which has effectively determined the outstanding indebtedness between the Honeywell Group and our client, Ecobank Nigeria Limited,” the letter stated.

A senior capital market operator said the Otudekos’ shares acquisition may be a subject of an investigation by Nigeria’s apex capital market regulator, the Securities and Exchange Commission (SEC), “to find why keeping the shares in proxies all that period”.

The Nation had reported exclusively that the single largest individual equity stake in FBN Holdings by Mr. Oba Otudeko’s Barbican Capital Limited was in a state of technical suspension until the Central Bank of Nigeria (CBN) determines the propriety of such acquisition.

Multiple sources had said the apex bank would subject the material acquisition to scrutiny in line with the apex bank’s “fit and proper” rules.

Nigeria’s apex capital market regulator, SEC, and Nigerian Exchange (NGX) also traditionally review material transactions such as Barbican Capital’s acquisition.

FBN Holdings at the weekend confirmed that Barbican Capital, an affiliate of Otudeko’s Honeywell Group Limited, had acquired about 4.77 billion ordinary shares in the holding group, representing 13.3 per cent of the group’s 35.9 billion issued shares.

About Bukola Olanrewaju

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