The controversy surrounding the planned Annual General Meeting of the Nigerian Exchange Group, which is scheduled to take place on the 30th of September 2022, took another turn Thursday as some of its shareholders applied for a court injunction to stop it.
In a notice to the public published in several newspapers, Counsel to the shareholders S.O&C Legal, brought the suit before the Federal High Court, applying for an interlocutory injunction to stop the AGM.
The shareholders were apparently responding to a suit filed against them by the NGX Group Plc stopping them from interfering with the planned AGM.
According to the counsel to the shareholders, rather than address their concerns, “NGX Group Plc instead filed a suit” against them.
NGX Takes shareholders to court
In a copy of the suit cited by Nairametrics, the NGX asked the court to allow the AGM to take place, and that resolutions passed are valid and lawful, and restrain some of the shareholders from interfering with the validity of the AGM.
The Suit No. FHC//CS/ 1808/2002 is between “Nigeran Exchange Group versus Mr. Olajuwon Olayinka, Idris Ibironke, Bamidele Olawoye, and All Members Of The Class Of Shareholders Of Nigerian Exchange Group Plc Represented By And Having The Same Interests As The 1st And 2nd Defendants” and is pending before the Hon. Justice T.G Ringim, sitting at the Lagos Division of the Federal High Court. Oyinkan Abayomi Drive, Ikoyi Lagos.
See excerpts
1. A DECLARATION that the Notice of the 61st Annual General Meeting of Nigerian Exchange Group Pic. (The Plaintiff Company) dated the 7th September 2022 by Mojisola Adesola, Company Secretary/Head of Compliance is lawful and validly issued and in accordance with all extant laws, regulations, and the Memorandum and Articles of Association (MEMART) of Nigerian Exchange Group PIc. dated 15th September 1960 as amended by a special resolution passed on the 3rd of March, 2020.
2. A DECLARATION that any and all Resolutions passed at the Annual General Meeting of the Nigerian Exchange Group Plc. consequent upon the said Notice of the 61st Annual General Meeting of Nigerian Exchange Group Plc. and issued by Mojisola Adesola, Company Secretary/ Head of Compliance on 7th September 2022 are lawful and validly made having been made in accordance with all extant laws, regulations and the Memorandum and Articles of Association (MEMART) of Nigerian Exchange Group Pc. dated 15th September 1960 as amended by a Special Resolution passed on the 3rd of March, 2020.
3. AN ORDER Restraining the Defendants individually and severally from interfering with the validity of the Notice of the 61st Annual General Meeting of Nigerian Exchange Group PIc. dated the 7th September 2022 by Mojisola Adesola, Company Secretary/Head of Compliance ON 7TH September 2022 and the Resolutions.
Shareholder Counter Suit
Some of the shareholders applied for an interlocutory injunction in suit No. FHC/L/CS 1808/2002-Nigerian Exchange Group vs Olajuwon Olyinka Idris & Anor-pending before the Hon. Justice T.G Ringim, sitting at the Lagos Division of the Federal High Court, Oyinkan Abayomi Drive, Ikoyi Lagos.
Nairametrics also obtained copies of their publications on the pages of some National print dailies where they publicly stated that they had also taken the NGX to court. The publication included the following;
“1 AN ORDER of interlocutory injunction restraining the Ist-13th Respondents hereto from assembling for presiding over, participating in, in any way holding or directing affairs of the 61st Annual General Meeting of the Ist Respondent scheduled to bold on Friday. 30d September 2022, notice of which was given by “NOTICE OF SIXTY- FIRST ANNUAL GENERAL MEETING” dated 7th September 2022, pending the hearing and determination of this Suit;
2 AN ORDER of interlocutory injunction restraining the 3rd, 4th, 6th, Lot. 11th, 12th, 14th, and 15th Defendants by Counterclaim or any person(s) appointed by the 2nd – 12th Respondent to act in their stead as a proxy to any shareholder, from acting and/or accepting to act as a proxy of any shareholder pursuant to the Ist Respondent’s “NOTICE OF SIXTY- FIRST ANNUAL GENERAL MEETING dated 7th September 2022, pending the hearing and determination of this Suit:
3 Such further or other order as this Honourable Court may consider fit to make in the circumstances of this case NGX Group Plc and its Board of Directors have been served with all processes in Suit No FHC/L/CS/ 1808/2022, including the application for an injunction, and are therefore fully aware of the prayers produced above.”
Optics
The squabble between the NGX Board and its shareholders is bad for the stock market which has seen stocks fall below the 50,000 points it hit earlier in the year.
- Nairametrics had earlier reported that the board of the Nigerian Exchange (NGX) will be reconstituted to reflect new shareholding structures.
- However, it appears this is not a foregone conclusion as intrigues continue to plague the planned AGM
- The optics here appear ominous for the Exchange in general as it dampens investor interest in the Nigerian economy.
This shows the desperation of Oscar. NGX suing shareholders? Has this ever happened in the capital market space in Nigeria for a listed company not to to talk of the self glorifying SRO. Board of Directors hold investors forum, meetings with shareholder groups, fact behind the figures, press conferences to explain issues not to resort to court processes. Investors not satisfied with explanations and who does not see value in the company are at liberty to sell their shares. That a listed company not in the least the Exchange will institute court process has opened a new chapter in shareholding arrangement
Let us reason together, why would NGX go on this route? I smell there is a lot of hidden information that they are preserving, which creates caveat emptor – buyer beware in the shares of NGX
NGX Legal department are using the process to be relevant in the scheme of things. They have created so many havocs for the exchange in this regard. If I recall vividly, under okereke-onyiuke, NGX had only three inhouse lawyers – my boss Prince Erediauwa, Mrs Igbinosun and Mr Elakama. The first two were the company secretaries through the years and they got the job done while the third was in administration though a qualified lawyer. What we have today is nauseating and very pathetic aside from cost ballooning. NGX now has a company secretariat, rules, legal departments with lawyers aside external solicitors sucking the fees with pipes abandoning straw. Also we have lawyers in mother departments like BDR etc. Is NGX a legal firm?
Thirdly, external solicitors are selling lemons to NGX and encouraging the exchange to institute needless action to enable them draw fees and pay kickbacks and gifts to their inhouse collaborators.
What will happen if staff that were cheated from their entitlements also take NGX to court? I learnt staff disengaged in February by NGX were not paid their incentive bonuses . Yet it was the NGX that initiated the disengagement. All hats will be thrown into the ring soon on this matter. The exchange under oscar courts trouble unlike the previous administration. It is news that the exchange is fond of cheating it’s work force and persistent threats. Now Japa has exposed the former mighty men of valour as they find it hard to replace disengaged staff or those that Japa into duspora
NGX should avoid the temptations to go to court on its shareholders. There are internal mechanisms to adopt