Oil & Gas
RECENTLY, the capital market has been inundated with the press release from the Securities and Exchange Commission, SEC, regarding the suspension of the Board of Directors of OANDO Plc.
The suspension was the result of the conclusion of a forensic investigation into the company’s affairs and the action of SEC has been questioned by the company, which also sought a legal redress.
Realnews magazine gathered that the genesis of the case can be traced to the petitions to the Commission by Alhaji Dahiru Mangal and Ansbury Incorporated, OANDO’s foreign investors, in July 2017, regarding alleged regulatory infractions, which included:
Insider trading in 2015, when certain directors of the company proceeded to sell their shares after the company had declared a closed period and the remuneration paid to the directors of the company over and above the provisions of the Board Charter.
The Non-Disclosure of series of related party transactions in its 2012 and 2014 Financial Statements and Failure to comply with several tax laws, including the Companies Income Tax Act ,CITA, Value Added Tax, VAT, and Withholding Tax, WHT, and the deduction of 24% of the dividend paid in 2014 as withholding tax, above the statutory requirement of 10%.
The document noted that in March 2018, the SEC instituted a Forensic investigation into the company, led by Deloitte and Touche and that the firm uncovered material misstatements in the financial statements, grave internal control deficiencies, false disclosures, market abuses and corporate governance lapses such as unjustified disbursements to Directors and Management, related party transactions, amongst others.
And to address these infringements, the SEC, through a Press statement directed the resignation of the affected Board members of Oando Plc, Convening of an Extra-Ordinary General Meeting on or before July 1, 2019, to appoint new directors; Payment of monetary penalties by the company, affected individuals and Directors and the Refund of improperly disbursed remuneration by the affected Board members to the company
The Commission also directed the barring of the Group Chief Executive Officer, GCEO, and the Deputy Group Chief Executive Officer, DGCEO, of Oando Plc from being directors of public companies for a period of five years.
However, on Friday, May 31, 2019: OANDO Plc in a swift response to the SEC, alleged that the press release on infractions and penalties were prejudicial to the business of the company.
OANDO made these claims on the grounds that the company had not been provided an opportunity to review and respond to the forensic report or prepare a defence to the SEC and was committed to challenge the SEC’S decision.
On Sunday, June 2, 2019, SEC had to set up Interim management team, following
Its directive on the resignation notice on the company’s board of directors, to oversee the affairs of the company temporarily. Amongst other things, the interim team has been mandated to conduct an Extraordinary General Meeting (EGM) on or before July 1, 2019 to appoint a new Board of Directors, who would subsequently select a management team for the company.
The interim management team is to be chaired by Mr. Mutiu Sunmonu, former Chairman of Shell Companies in Nigeria.
But on Monday, June 3, 2019: the court restrains SEC from removing the directors.
The affected directors, Wale Tinubu and Omamofe Boyo, obtained a court injunction from the Federal High Court sitting in Lagos, restraining the SEC from going ahead with the specified actions, pending the hearing and determination of the motion for an interlocutory injunction.
In the statement termed – Our Position, it was revealed that in 2016, Meristem Research discontinued coverage of OANDO Plc, due to circumstances surrounding the company’s operations, lack of clarity in company structure and perpetual lateness in filing of the company’s returns, which has however, improved.
In the light of the persistent corporate governance infractions and possible litigation from the existing leadership over the management change, the counter remains outside
This is a story of Nigeria’s biggest indigenous oil and gas company, a 61-year-old entity that was morphed over the years by a combined dose of ballsy youthfulness, ruthless ambition and the kind of opportunity that can only be found in an emerging economy.
The story begins with a historical perspective of the company and how it came to be one of Nigeria’s most controversial businesses. It culminates in the recent boardroom scandal that is threatening its future, as well as the investment and jobs of thousands of Nigerians. – Nairametrics
– June 5, 2019 @ 16:55 GMT |
Tags: OANDO Plc: Report unveils genesis of suspension of directors
