A Federal high court sitting in Lagos south west Nigeria has adjourned till 2nd of May,2018
for the hearing of $28,728,125 suit jointly instituted by Industrial
Mongol Oba Otudeko and a limited liability company broad communication
limited against a cellular mobile Telecommunications company, Airtel
Networks Limited (formerly known as Econet wireless Nigeria limited )and
9 others.
Joined as co -defendants in the ensuing legal battle are :a
promoter of Econet Jubril Adewale TINUBU, with 9,906250 shares being
9.9% voting capital, O&0 Networks limited, Delta ministry of Finance
Incorporated, Delta State Government, Corporate Affairs Commission,
Econet wireless Limited,Econet Development Corporation, Ecobank Nigeria
limited, Ecobank Transnational Incorporated.
for the hearing of $28,728,125 suit jointly instituted by Industrial
Mongol Oba Otudeko and a limited liability company broad communication
limited against a cellular mobile Telecommunications company, Airtel
Networks Limited (formerly known as Econet wireless Nigeria limited )and
9 others.
Joined as co -defendants in the ensuing legal battle are :a
promoter of Econet Jubril Adewale TINUBU, with 9,906250 shares being
9.9% voting capital, O&0 Networks limited, Delta ministry of Finance
Incorporated, Delta State Government, Corporate Affairs Commission,
Econet wireless Limited,Econet Development Corporation, Ecobank Nigeria
limited, Ecobank Transnational Incorporated.
According to an amended statement of claim filed on behalf of Oba
Otudeko and broad communications limited by Chief Wole Olanipekun SAN,
OFR, the plaintiffs alleged that sometime in 2011, Ecobank Transnational
Incorporated acquired the defunct Oceanic bank Plc with all its
liabilities and assets which at the time of acquisition included the 3rd
defendant O&0 Network limited, Prior to the acquisition of Oceanic
bank the plaintiffs became aware that the 4th defendant, Delta State
ministry of Finance incorporated and the 5th defendant Delta State
Government purportedly transfer their beneficial ownership in the shares
of the O&0 Network Limited to back to 2nd defendant Jubril Adewale
Tinubu who subsequently purported to transfer the shares to Oceanic bank
Plc as part of a process of securitization and foreclosure arising from
loans advanced to him by Oceanic bank.
The plaintiffs stated further that in the course of promoting
Airtel, it was a fundamental term that in order to facilitate financing
arrangements, Nigerian individual shareholders would take their shares
in their own names or by the agency of their respective nominee
vehicles, by this agreement Oba Otudeko was to hold directly or
indirectly, 15% of the ordinary shares and Jubril Adewale Tinubu was to
hold directly or indirectly about 10% of the ordinary shares of the
company.
Further to the above arrangement and as preliminary step toward the
acquisition of 40%equity stake in Airtel, Oba Otudeko and Adewale
Tinubu through a special purpose corporate vehicle called First
Independent Network limited FINL, executed a settlement agreement dated
11June 2001,with Econet International Limited.
It was also selected fundamental term of the agreement that
Nigerians would hold 40% of the ordinary shares and that Econet Wireless
International EWI, being the original technical partner would hold
40%,while 20% was reserved for Transtel -a South African company.
Oba Otudeko took 13,035,936 shares in the name of Broad
communication and 187,500 in his own name while Adewale Tinubu took
9,906,250 shares in the name of Ocean &Oil services and later
transferred same to O&0 Network .
The shareholders agreement confers on the shareholders a’ ‘right of
first refusal’ in relation to the disposal of shares or interest
therein by any conceivable means; and outline procedures to be followed
for giving notice of intention to dispose and further mechanism for
dealing with such shares.
However, the plaintiffs alleged further that sometime in
2005,without any formal or informal notice they became aware that in
2001 and 2003,JubrilAdewale Tinubu acting as the alter ego of O&0
Network reached secret agreements to transfer all the company’s share in
Airtel to Delta State ministry of Finance incorporated and Delta State
Government for a premium.
The 9,906,250 ordinary shares of the O&0 Network sold, in
breach of the plaintiffs pre-emptive right was valued at $4.50 thereby
amounting to $44,578,125.
The transaction was deliberately concealed from the plaintiffs and
other shareholders with Adewale Tinubu continuing to represent that he
represented himself rather than the Delta State ministry of finance
incorporated and Delta State Government on the board of Directors of
Airtel.
The plaintiffs averred that Adewale Tinubu and one David Edevbie,
the then commissioner for Finance and Economic Planning in Delta State
made statements to the Economic and Financial Crimes Commission EFCC in
or about August-November 2004 admitting that the respective transactions
entered into between them had the sole objective of dealing in the
shares of Airtel contrary to the agreement and the understandings
binding parties and other shareholders in the Airtel company.
On 11th of March, 2013,the plaintiffs divested their interest in the Airtel Company. The value of the 9,906,250 ordinary shares sold by Adewale Tinubu
and O&0 Network to Delta State ministry of finance incorporated and
Delta State Government in breach of the Plaintiffs pre-emptive rights
had appreciated in value from $4.5 per share to $7.4 per share as at the
time the plaintiffs divested their interest in the Airtel company
amounting to $73,306,250, consequently the differential in the value of
the shares when the plaintiffs divested their interest amounts to
$28,728,125.
The plaintiffs claim against the defendants jointly and severally are as follows:
An order mandating the defendants to pay the Plaintiffs the sum of
$28,728,125 being the interest /profit accrued on the 9,906,250,ordinary
shares sold in breach of the plaintiffs pre-emptive rights in the
Airtel Company.
L Interest on same at the rate of 23% per annum from 15th July, 2003 till judgement is delivered. Cost of this legal action assessed at N100million.
However, In an affidavit in support of statement of defence sworn
to by Airtel legal officer Kingsley Anyiam, filed on behalf of Airtel by a
Lagos lawyer, Barrister C. A.Candide-Johnson SAN, the deponent averred
that Airtel was not privy to the facts that led up to the dispute, as
relayed by the Plaintiffs in their statement of claim. In addition
Airtel is not a party to the shareholders agreement which forms the crux
of this dispute, as the shareholders agreement was entered strictly
among the shareholders of Airtel as at the relevant time of this suit.
Consequently the Plaintiffs statement of claim do not have any
adverse reliefs against Airtel .therefore, Airtel need not be party to
this suit in order to comply with any lawful order of the court.
The court is therefore urged to dismiss this legal action against
Airtel or in the alternative to strike out the name of Airtel from the
suit.
