Ecobank Subsidiary Rubbishes Airtel Shares Forfeiture Claim
By Modupe Gbadeyanka
An arm of Ecobank Group, O&O Networks Limited, has described reports in some sections of the media that a Federal High Court asked it to forfeiture shares of the company in Airtel Nigeria as not only false, but misleading.
It was reported last week that the court had directed the firm to forfeiture its stake in the telecommunication company.
O&O Networks Limited is defending long-standing proceedings in the Federal High Court relating to its ownership of shares in Airtel Networks Limited that were once owned by it.
The company, previously owned by Oceanic Bank, formed part of Ecobank Transnational Incorporated’s (ETI) in 2011 after the acquisition of Oceanic Bank.
Legal proceedings were first initiated against O&O Networks Ltd in December 2006 by Broad Communications Ltd (plaintiff) in the Federal High Court of Nigeria.
A statement released by O&O Networks, pointed out that there was no forfeiture order of the Federal High Court of Nigeria in these proceedings that is directed against ETI or Ecobank Nigeria Limited.
According to the statement, there have been no material legal developments in the plaintiff’s substantive claim for monetary compensation since 2017, though a trial date on the substantive merits was recently fixed for May 28, 2019.
“Contrary to certain press reports, there is no forfeiture order of the Federal High Court of Nigeria in these proceedings that is directed against ETI or Ecobank Nigeria Limited, and neither ETI nor Ecobank Nigeria Limited has made or is required by law to make any payment to the Federal High Court of Nigeria in relation to this long-standing litigation.
“There have been no material legal developments in the plaintiff’s substantive claim for monetary compensation since 2017.
“In 2006, the plaintiff’s claim was grounded on an alleged right of first refusal over shares in Airtel Networks Limited that O&O Networks owned.
“The plaintiff claimed ownership of the Airtel shares based on its right of first refusal. In 2017, the plaintiff amended its claim to seek monetary compensation of Dollar equivalent of N10 billion (approximately $28 million) in place of its claim of ownership of the Airtel share.
“Since the matter was filed in 2006, it has not proceeded to trial on the substantive merits of the claim to date though a trial date on the substantive merits was recently fixed for May 28, 2019
“In August 2018, O & O Networks sold its shares in Airtel Networks Limited for N22.5 billion (approximately $62.5 million) with the permission of the Federal High Court on June 7, 2018 and subsequently in September 2018, the plaintiff filed an interlocutory application requesting the Federal High Court of Nigeria to grant an order directing O&O Networks to place N22.5 billion (approximately $62 million) – the entire proceeds of the sale of the Airtel shares and an amount which is significantly in excess of the plaintiff’s total monetary claim – into an escrow account in the name of the Chief Registrar of the court, pending the final determination of the substantive claim. The Federal High Court of Nigeria granted the plaintiff’s interlocutory application on March 7, 2019.
“O&O Networks has filed a notice of appeal and an application for stay of execution to this ruling. O&O Network’s appeal to the interlocutory order is currently pending, and it intends to prosecute the appeal vigorously.
“O & O Networks Limited believes the substantive claim of the plaintiff is without merit and will continue to vigorously defend all proceedings – interlocutory and substantive – in relation to the plaintiff’s long-standing claim,” the statement from the company said.