Connect with us

Business

COURT AWARDS N72BN AGAINST ECOBANK IN FAVOUR OF HONEYWELL

Published

on

COURT AWARDS N72BN AGAINST ECOBANK IN FAVOUR OF HONEYWELL

 

The Federal High Court has delivered a judgment in favor of Honeywell Flour Mills Plc in a protracted suit against Ecobank Nigeria, granting all four reliefs amounting to the sum of N72.2 billion.

According to details of the court proceedings seen by BusinessDay, Justice Mohammed Liman of the Federal High Court in Lagos in his ruling on Tuesday noted that “The plaintiff was denied the use of funds in his account based on the ex parte order granted in favour of the defendant.”

Honeywell had in 2018 filed a suit claiming the sum of N72 billion in damages from the bank for reputational losses suffered as a result of the asset-freezing ex-parte order.

The claims include foreign exchange devaluation loss, interest on unutilised cash balance, loss of revenue, and aggravated and exemplary damages.

“It is, therefore, my firm view that the plaintiff is entitled to the amount claimed in relief,” Justice Liman said in his ruling.

He added, “The argument of the defendant in his written address is therefore not acceptable as the contents of the document are the best evidence and they speak for themselves.”

The legal battle between Honeywell and Ecobank commenced in 2015 as a result of a dispute between the two companies over the terms of settlement of a debt, which the company owed the bank.

Honeywell had claimed that it had settled its outstanding debt to Ecobank having fulfilled its part of an agreement with the bank to pay the sum of N3.5 billion as full and final payment of the company’s obligation to the bank.

Ecobank, meanwhile, claimed that this agreement was not binding on the bank as its Board of Directors had not ratified the agreement, which was communicated to Honeywell by the Managing Director of the bank.

The bank also claimed that the payment was not made within the stipulated timeline. Seeking a resolution to the issue,

Honeywell sought the intervention of the Chartered Institute of Bankers of Nigeria’s (CIBN) Sub-Committee on Ethics and Professionalism (Bankers’ Committee), being the industry-accepted dispute resolution mechanism for resolving disputes between bankers and their customers.

The Bankers’ Committee is an organ made up of representatives from the Central Bank of Nigeria (CBN), CIBN, Nigeria Deposit Insurance Corporation (NDIC) and Managing Directors of Banks.

At the end of the review of the arguments adduced by Honeywell and Ecobank, the Bankers’ Committee ruled in Honeywell’s favour by resolving that the payment of N3.5 billion by Honeywell was indeed full and final settlement of its obligations to Ecobank and Honeywell was not indebted to Ecobank.

Not satisfied Ecobank asserted, through correspondence with the company, that the company was still indebted to the bank and also maintained the company’s name in the CBN’s credit risk management database portal for non-performing loan accounts.

Honeywell Group, therefore, sought the intervention of the courts to give effect to the decision reached at the Bankers’ Committee.

“The bank, through its lawyer, went on to institute several suits against Honeywell before multiple judges of the same Federal High Court, Lagos Judicial Division with all primarily being in respect of the same subject matter, seeking an order to freeze all the accounts of the company and deny the company access to all its funds with banks in Nigeria,” the Nigerian lawyer said in its publication.

Asides from Justice Mohammed Yunusa, who eventually granted the order, all the courts approached, requested the bank to put Honeywell on notice regarding the ex-parte order, which was applied for.

Honeywell is now claiming damages based on the order granted by Justice Yunusa claiming the move was designed primarily to injure its business and cause significant embarrassment to principals and officials of the company, according to Nigerianlawyer bulletin.

“The defendant’s arguments in this regard cannot stand.…… I have no hesitation in granting relief in favour of the plaintiff,” Justice Liman said.

 

Business

Guaranty Trust HoldCo Proposes N500bn Share Offering

Published

on

By

Guaranty Trust HoldCo Proposes N500bn Share Offering

Guaranty Trust HoldCo Proposes N500bn Share Offering

Guaranty Trust Holding Company (GTCO) Plc, said it has filed a preliminary ‘red herring’ prospectus with the Securities and Exchange Commission (SEC) to raise N500 billion.

The Company in a notice said the number of ordinary shares to be offered and the price range for the proposed offering have not yet been determined.
The notice said “this is issued in reliance on Rule 283 of the Rules & Regulations of SEC, Nigeria. The notice read in part, this does not constitute an offer to sell or the solicitation of an offer to buy any securities.

“Any offer, solicitation or offer to buy, or any sale of securities will be made only by a prospectus duly registered by the Securities and Exchange Commission, Nigeria (SEC) in accordance with the provisions of the Investments and Securities Act, No. 29, 2007 (the Act) and the rules and regulations of the SEC made pursuant to the Act (the SEC Rules).”

Stating the purpose of the proposed offering, the notice further said that, “the net proceeds of the proposed offering will be used for the growth and expansion of the GTCO Group’s businesses. Such planned growth and expansion will be effected through investments in technology infrastructure to fortify existing operations, the establishment of new subsidiaries and selective acquisitions of non-banking businesses; and the recapitalisation of Guaranty Trust Bank Limited.”

It added that “the proposed offering is structured as an institutional offering targeted at eligible investors and a retail offering within Nigeria and a private placing to persons reasonably believed to be qualified institutional buyers outside Nigeria (the international tranche).”

It noted that the proposed offering is anticipated to open by July, 2024, adding that the filing of the red herring prospectus was undertaken with a concurrent filing of a preliminary universal shelf registration statement.

“The universal shelf registration will permit GTCO to establish a multi-currency securities issuance programme (the Programme) to issue various types of securities, or any combination of such securities, in one or more offerings, from time to time, to raise proceeds in an aggregate amount of up to $750 million or equivalent amount in Nigerian naira) in the Nigerian/international capital markets during the validity period of the Programme.”

Continue Reading

Business

Wema Bank concludes 1st tranche of capital raise programme

Published

on

By

Wema Bank concludes 1st tranche of capital raise programme

Wema Bank concludes 1st tranche of capital raise programme

 

Wema Bank, Nigeria’s foremost innovative bank and pioneer of Africa’s first fully digital bank, ALAT, has successfully concluded the first tranche of its recapitalisation exercise having secured all relevant regulatory approvals for the allotment of its N40bn Rights Issue which was initiated in December 2023.

In view of macroeconomic conditions, the Central Bank of Nigeria (CBN) in March 2024, launched a recapitalisation programme requiring commercial banks to raise fresh capital in alignment with the minimum requirement for their respective banking licenses, within a 24-month timeline spanning April 1, 2024, to March 31, 2026.

The goal of this recapitalisation programme is to simultaneously boost the Nigerian economy and strengthen the Nigerian financial services industry.

As a forward-thinking and pioneering bank, Wema Bank in December 2023 launched a N40bn Rights issue which has now been approved by the Central Bank of Nigeria and the Securities and Exchange Commission (SEC). With this remarkable development, Wema Bank has now successfully raised N40bn of the N200bn minimum requirement laid down by the CBN.

In a statement made to the public by the Bank, Moruf Oseni, Wema Bank’s Managing Director and CEO, iterated the Bank’s resolve in retaining its Commercial Banking license with National Authorisation, adding that the N40bn Rights Issue is a step in that direction.

“We are delighted to announce the conclusion of the 1st tranche of our Capital Raise Programme, after obtaining the relevant approvals of all regulatory authorities. Our move to commence our Capital Raise Programme very early demonstrates our push for excellence and with a strong emphasis on our digital play, we are set to amass more successes in the coming months.”

“We were impressed by the vote of confidence given by our shareholders during the 1st Rights Issue exercise as our shares were fully subscribed. In addition, we obtained the approval of shareholders at our 2023 Annual General Meeting (AGM) to raise an additional N150billion to meet the capitalisation threshold set by the CBN. The process is expected to be completed within 12-18 months. We are committed to providing optimum returns for every stakeholder and the successful conclusion of this N40bn Rights Issue is a bold step in the right direction.”

In addition to the upward trend in the Bank’s financial performance and the success recorded so far in its recapitalisation exercise, Wema Bank’s corporate rating was recently upgraded to BBB+ by Pan African credit rating agency, Agusto and Co, and retained at BBB by international rating agency, Fitch.

Over the medium to long term, Wema Bank is positioned to dominate not only the digital Banking space but also the Nigerian financial services industry at large as it translates its industry leadership to significant market share.

Wema Bank is a leading financial services entity with banking operations across Nigeria, its leadership position in the digital banking space speaks to its aspirations to liberate Nigerian businesses and entrepreneurs by making digital platforms widely available.

Continue Reading

Business

Zenith Bank confirms Sirika’s daughter owns a company linked to N1.4 billion Aviation contract

Published

on

By

Zenith Bank confirms Sirika’s daughter owns a company linked to N1.4 billion Aviation contract

Zenith Bank confirms Sirika’s daughter owns a company linked to N1.4 billion Aviation contract

A compliance officer from Zenith Bank Plc, Mishelia Arhyel, told the Federal Capital Territory High Court Abuja on Tuesday that former Minister of Aviation, Hadi Sirika’s daughter, Fatima, and son-in-law, Jalal Hamma, owned Al-Buraq Global Investment Ltd, a company the Economic and Financial Crimes Commission (EFCC) indicted in an aviation fraud suit.

Arhyel testified as EFCC’s second witness in the fraud-related charges instituted against Hadi Sirika and his daughter, Fatima, son-in-law, Jalal Hamma, and Al-Buraq Investment Ltd.

The defendants had been arraigned before Justice Sylvanus Oriji of the FCT High Court.

EFCC’s Case
The EFCC had indicted Hadi Sirika, in an alleged contract fraud involving his daughter and son-in-law as well as fraudulent practices associated with the Nigeria Air debacle.

Sirika was accused of allegedly using his position to unfairly benefit Tianaero Nigeria Limited and Al Buraq Global Investment Ltd; companies allegedly associated with his associate, daughter, and son-in-law.

He was said to have influenced the award of contracts for the Nigerian Air project and the Apron Extension at Katsina Airport to these companies.

The EFCC alleges that N1.4 billion was approved to Al-Buraq for the Apron Extension contract at Katsina Airport.

The defendants are accused of breach of trust and misuse of public office to the tune of over N2 billion naira in contravention of the Corrupt Practices and Other Related Offences Act and the Penal Code Act.

But they all pleaded not guilty to the charges paving the way for the commencement of trial.

What transpired in court
Led in evidence by EFCC lead counsel, Rotimi Jacobs (SAN), Arhyel, said his role as a compliance officer involves receiving correspondence from law enforcement agencies on behalf of Zenith Bank and forwarding the same to appropriate authorities as well as responding to inquiries.

He confirmed that sometime in February 2023, the bank received a letter from EFCC making inquiries regarding accounts statements on Al-Buraq, Jalal Hama and Fatima.

The prosecution counsel then tendered the bank statements of the defendants and it was admitted by the court unopposed by the defense legal team.

Speaking to the documents, Arhyel told Justice Oriji that Al-Buraq was registered on June 17, 2021, and the directors are Hamal Jalal, Sirika Fatima Hadi and Shinade Saratu.

According to the witness, the ex-minister’s daughter and in-law have significant control over Al-Buraq.

“Sirika Fatima Hadi is the secretary of the company.

“Persons in significant control of the company are Hamal Jalal and Sirika Fatima Hadi.

“The signatories are Saratu Muhammad, Fatima Hadi Sirika, and Jalal Hamal,” the witness told the court corroborating EFCC’s allegations.

Earlier in the proceedings, Azubuike Okorie, a former Special Assistant to the ex-Aviation Minister, Projects(2022-2023) said it was the frustration posed by the Nigerian Air Force and the Federal Airports Authority of Nigeria (FAAN) that prevented the execution of the Kastina Airport extension contract.

Under cross-examination by the defense team led by Kanu Agabi (SAN), Okorie said the contract went through due process and had nothing to do with the competence and honesty of the contractor.

The witness claimed the relationship between Sirika, his family members and associates was not a factor considered in the contract awarded to Al-Buraq.

The court subsequently adjourned the trial to June 20, 2024.

Backstory
The EFCC had said its operatives arrested Abubakar Ahmad Sirika, the brother of Hadi Sirika, over an alleged contract fraud in the aviation ministry.

Abubakar was picked up by the anti-graft agency on Sunday, February 4, following an investigation in the Ministry of Aviation and Aerospace Development.

During his tenure as minister, Sirika faced allegations including conspiracy, abuse of office, diversion of public funds, contract inflation, criminal breach of trust, and money laundering totalling N8,069,176,864.

The commission had revealed that the funds in dispute related to four aviation contracts awarded by the former minister to a company called Engirios Nigeria Limited, which is owned by his younger brother.

The EFCC is empowered by law to track financial crimes.

Every accused person remains innocent until found guilty by a competent court.

Sirika served as aviation minister from 22 August 2019 to 29 May 2023.

Continue Reading

Trending