Seplat issued a press release on the website of the Nigerian Stock Exchange vowing to sue Access Bank claiming that “the action was taken by Access Bank without any prior notice to SEPLAT, as required under Nigerian law.”
Access Bank sources indicate the outstanding loan is about $85.8 million and is secured by a fixed and floating Debenture over Cardinal’s assets.
Access Bank obtained an Ex-Parte Order from a Federal High Court against Cardinal Drilling Services, Seplat, ABC Orjiakor, and Kalu Nwosu. The bank also obtained a Mareva injunction freezing the accounts of Seplat in Nigeria and abroad. Reliable sources with knowledge of the matter claim Access Bank was targeting ABC Orjiakor in the Sealing of Seplat headquarters.
The Mareva Injunction targeted the following assets;
25, Lugard Avenue, Ikoyi, Lagos,
6, Agodogba Avenue, Parkview, Ikoyi, Lagos
11, Oba Adeyin’ka Oyekan Street, Ikoyi, Lagos
Seplat claims it is neither a shareholder in Cardinal Drilling and that it has no “outstanding loan obligations or guarantees to Access Bank and did not at any time make any commitments or guarantees in respect of Cardinal Drilling’s loan obligations” to the bank.
Access Bank appears to have also gone after Seplat because ABC Orjiakor, the chairman of Seplat, is an investor in Cardinal Drilling.
A source informed Nairametrics that by joining Seplat to the case, Access Bank believes it will pile pressure on Seplat forcing it to reach a deal that will either see the loan repaid or get some guarantees from Seplat that it will get ABC Orjiakor to allow the bank take over the assets of Cardinal Drilling without a tussle from Orjikor.
In a document shared with Nairametrics, the Bank explained in a court filing that its decision to go after Seplat was because there is an “intercompany relationship between SEPLAT and Cardinal Drilling”, noting that “they are jointly promoted by Orjiako” its primary target.
According to the document, “SEPLAT is a sister company to Cardinal, jointly promoted by Orjiako who is the alter ego of the two companies.”
Seplat in its annual report disclosed Cardinal Drilling Services as a related party based on entities controlled by Key Management Personnel.
It revealed in the annual report that “Cardinal Drilling Services Limited (formerly Caroil Drilling Nigeria Limited): Is owned by common shareholders with the parent company. The company provides drilling rigs and drilling services to Seplat. Transactions with this related party amounted to N2.89billion, $9.44million (N621million, $2.03million). Receivables and payables were nil in the current period (receivables in 2018: N1.49billion, $4.87million).”
Access Bank is understood to be grappling with a string of bad loans issued under the defunct Diamond Bank. Sources inform Nairametrics that the bank is stepping up efforts to go after some of the debtors by obtaining several court orders to seize properties.