Article Summary
- Mr. Wasiu Sowami, Chairman of Ardova Plc, has completed the payment of the acquisition of the company from billionaire businessman Mr. Femi Otedola.
- The acquisition was initially disputed, with an arbitration ruling awarding $19 million to Otedola, who sought payment of the remaining $20 million owed by Sowami.
- Zenon Petroleum and Gas Limited, owned by Otedola, had previously won an arbitration case against Ignite Investment Limited, another company owned by Sowami, over a share purchase agreement involving Forte Oil Plc. Zenon was awarded $19.2 million in that dispute.
The Chairman of Ardova Plc, Mr. Wasiu Sowami, has completed the payment of the acquisition of the company from billionaire businessman, Mr. Femi Otedola.
The acquisition was made through a Special Purpose Vehicle (SPV) called Ignite Investment and Commercial Limited (IICL) in 2020. Initially, Sowami sought to avoid paying the remaining $20 million owed to Otedola after acquiring Ardova, but an arbitration ruling favored Otedola, awarding him $19 million.
Recall in November 2022Zenon Petroleum and Gas Limited won an arbitration case instituted by Ignite Investment Limited in the London Court of International Arbitration (LCIA) over the share purchase agreement (SPA) reached on the sale of Forte Oil Plc to the latter.
Precisely, Zenon Petroleum was awarded $19.2 million by the LCIA in the dispute. In June 2019, Zenon Petroleum completed the sale of 74.02% shares of Forte Oil Plc to Ignite Investments (Ignite).
Ignite triggered a dispute notice via a letter dated June 17, 2020, wherein the company had alleged claims for a breach of warranty relating to the SPA executed on the 20th of December 2018.
In the main, the dispute notice had alleged that Zenon breached certain warranties under the SPA, in consequence of which, the purchaser made the relevant claims against Zenon.
In line with the SPA, the parties agreed to meet with the intention to find a solution to the alleged claims by Ignite. This was not successful, following which Ignite filed a claim at the London Court of International Arbitration (LCIA) on the 18th of December 2020. Zenon then filed its response to the claim and counter-claimed against Ignite.
Formerly known as Forte Plc, Ardova underwent a successful turnaround under the leadership of Otedola. The company experienced significant growth, consistently increasing its market capitalization, shareholder funds, and dividend payments over the past decade.
This value accretion played a crucial role in making Ardova a market leader both before and after the acquisition.
Otedola expressed his delight that Ardova has maintained its market position and is now undoubtedly Nigeria’s largest downstream petroleum marketing company.
Ardova recently released its 2022 audited accounts showing a loss after tax of N7.6 billion worse than the N3.8 billion loss reported a year earlier. The company’s losses were due to rising operating expenses and high finance costs.
Loans and borrowing stood at about N59 billion in 2022 about 6x its net assets of N9.2 billion.
