EcoBank Plc has asked the Federal High Court in Lagos to temporarily restrain Otudeko Obafemi Adedamola, the son of Oba Otudeko, and others, including the Corporate Affairs Commission (CAC), from selling or transferring 6,314,116,229 Barbican Capital Limited shares in FBN Holdings.
This request was made in a motion accompanying the bank’s main suit, both instituted by Kunle Ogunba (SAN) against Otudeko, Barbican Capital Limited, Honeywell Flourmills of Nigeria Plc, Siloam Global Services Limited, Oyeleye Foluke, FBN Holdings Plc, CAC, and the Nigerian Stock Exchange (NGX).
The bank’s lawyer alleges that Honeywell, Siloam, and Otudeko (2nd to 4th defendants) are taking steps to deprive the plaintiff of its right to benefit from the Supreme Court judgment in Suit No. SC/CV/210/2021, which allegedly affirmed the indebtedness of Honeywell and Siloam to the plaintiff, by divesting the stakes of Honeywell and using the funds realized from this to set up Barbican.
Details of the Case
According to the motion, Ogunba sought “an order of interim injunction of this court restraining the defendants on record, either collectively or individually, from taking any steps to amortize, dematerialize, compromise, sell, transfer, or otherwise deal with the 6,314,116,229 collective aggregate shares of the 1st defendant in the 6th defendant pending the hearing and determination of the Motion on Notice.”
- He equally sought an interim order restraining the defendants from taking any steps to amortize, dematerialize, compromise, sell, transfer, or otherwise convert into cash or any negotiable instrument any dematerialized shares of Honeywell (2nd defendant) pledged to the plaintiff in furtherance of the credit facility availed to the 2nd defendant to purchase the said shares, pending the hearing and final determination of the motion on Notice.
- In the main suit, the bank asked the court to direct FBN Holdings and NGX to rectify FBN’s register of shareholders to reflect EcoBank as the substantive shareholder of the shares purchased in FBN by Barbican Capital Limited, among other requests.
- Citing the grounds for his interim injunction request, the lawyer argued that by virtue of the Supreme Court judgment in Suit No. SC/CV/210/2021, dated January 23, 2023, which affirmed Honeywell and Siloam’s indebtedness to the plaintiff, the plaintiff is entitled to reap the benefits of its success at the apex court.
He added that Honeywell, Siloam, and Otudeko are taking steps to deprive the plaintiff of its right to benefit from the Supreme Court judgment by divesting Honeywell’s stakes.
“Barbican (1st defendant) is an affiliate company of Honeywell and is using the funds realized from the divestment of Honeywell to acquire 6,314,116,229 (15.08%) shares in FBN Holdings, thereby using funds that should have been used to settle Honeywell’s indebtedness to the plaintiff,” he added.
“Thus, there is an urgent need for this Honourable Court to grant the application of the plaintiff in this suit to restrain the defendants from tampering with the res (subject matter) in this suit,” he stated.
- He stressed that if the application is not heard expeditiously, the defendants will compromise and transfer their shares in FBN, which, according to him, are the same shares acquired with funds realized from the divestment of Honeywell.
Ruling of the Court
At the resumed hearing of the motion on April 3, Ogunba moved his motion and urged the court to grant the interim orders in the interest of justice.
- After hearing him, Justice Deinde Dipeolu ruled that the bank shall serve the respondents with the Motion on Notice, and the respondents shall, within seven (7) days of service, respond and show cause why the motion should not be granted.
- The court also held that the plaintiff shall be at liberty to file their reply on points of law if necessary, within 24 hours of receiving the respondents’ response.
The case was then adjourned to April 15, 2025, for hearing the motion on notice.
Backstory
EcoBank and Honeywell have been in a long-standing legal battle since 2015 over an unpaid debt of N5.5 billion by the latter.
- While Ecobank is maintaining that Honeywell is indebted to it to the tune of the aforementioned money, out of which N3.5 billion had been paid, Honeywell claimed to have paid the debt in full.
- In the wake of the legal tussle, Dr Oba Otudeko, Honeywell Group chairman, had told a Court of Appeal that the sum was owed to individual companies.
- These companies include Anchorage Leisures Limited, Siloam Limited, and Honeywell Flour Mills Plc.
- Otudeko maintained that his companies had paid N3.5 billion as of December 12, 2013, as the full and final payment for the N5.5 billion debt as agreed by the parties at a July 22, 2013, meeting.
But the Supreme Court in 2023, dismissed an appeal by Honeywell Flour Mills Limited challenging the judgement of the Court of Appeal in a N5.5 billion debt dispute with Ecobank Nigeria Limited.
The Supreme Court panel, led by Tijjani Abubakar, delivered the judgment on the substantive issues, holding that Honeywell, Anchorage, and Siloam were indeed indebted to Ecobank.
