By Meletus EZE
Our attention has been drawn to reports in print and digital news media purporting that the International London Court of Arbitration has ordered Oando PLC or Wale Tinubu to pay $680 million to Gabriel Volpi, following an investment dispute between Whitmore Asset Management Limited, jointly owned by Adewale Tinubu and Omamofe Boyo and Ansbury Investment Inc. owned by Gabriel Volpi.
The management of Oando Plc said the company is not a party to the arbitration and the London Court of International Arbitration did not order Oando PLC to pay any sum of money to Ansbury Investments Inc., adding that Oando PLC is not in any way indebted to Ansbury Investments Inc.
“We understand that the parties involved in the arbitration are Whitmore Asset Management Limited (a company beneficially owned by Jubril Adewale Tinubu and Omamofe Boyo) and Ansbury Investments Inc. (a company beneficially owned by Gabrielle Volpi). We confirm that neither party is a shareholder in Oando PLC.
“We are informed that the London Court of International Arbitration (LCIA) on July 6, 2018 ruled that Whitmore Limited should pay Ansbury Inc. the sum of $80million. The LCIA also ordered Ocean and Oil Development Partners OODP BVI (OODP BVI), a joint venture company incorporated in the British Virgin Islands by Ansbury Inc. and Whitmore Limited, to pay Ansbury Inc. the sum of $600million.
“OODP BVI are in turn 99 per cent shareholders in Ocean and Oil Development Partners Nigeria (OODP Nigeria) the majority shareholder in Oando PLC by way of 57.37 per cent stake in the Company.
“The stories also make mention of the petition that Ansbury Inc. filed with the Securities and Exchange Commission (SEC) about mismanagement of Oando PLC and indebtedness arising from Ansbury’s interpretation of the published 2016 Audited Financial Statements of Oando PLC.
“This is to remind our shareholders and the general public alike that following the petition to the SEC and in line with the SEC’s directives on October 18, 2017, a forensic audit into the affairs of the Company officially began with an on-site review by the appointed external auditor commencing in March 2018.
“In the spirit of goodwill, transparency and full disclosure, the Company will continue to cooperate with the SEC in the discharge of their duties as the Capital Markets regulator during this exercise as well as update the market on any reports that may have a bearing on investors’ decision and the value of their shares.”
This is coming amid accusations by aggrieved shareholders of attempts to suppress the report of the ongoing forensic audit of its operation, Oando PLC Chief Executive, Wale Tinubu, and his deputy, Mofe Boyo, have been asked to pay Ansbury Investments Inc. about $680 million (about N207.9 billion @ N305.8/dollar).
Ansbury was incorporated in Panama as part of a family trust by an Italian-Nigerian businessman, Gabriele Volpi.
The three-member London Court of International Arbitration (LCIA) presided by David Midon on July 6 gave the partial award against the two embattled top officials of Nigeria’s indigenous oil company.
In the ruling, affirmed by two other co-arbitrators, Marco Frigessi di Rattalma and Harry Matovu, the tribunal upheld Mr Volpi’s application that Ocean and Oil Development Partners (OODP) was indebted to Ansbury by about $600 million (about N183.5 billion).
OODP Limited, incorporated in the British Virgin Islands, controls 55.96 per cent equity in Oando PLC through a holding company, Ocean and Oil Development Partners (OODP) Nigeria Ltd.
The company was established at a time Oando PLC was preparing to acquire ConocoPhillips’ upstream oil and gas assets in Nigeria.
According to a copy of the tribunal ruling gathered by counsel to Ansbury Investment, Andrea Moja, the court also held that Whitmore Asset Management Limited was liable for another debt of $80 million (N24.5 billion).
Whitmore, incorporated in the British Virgin Islands as a single purpose investment vehicle, belongs to Messrs Tinubu and Boyo.
Court documents also showed initial agreement signed on June 17, 2013 gave 60 per cent equity in the venture to Ansbury and 40 per cent to Whitmore.
However, the source of dispute was whether there was a legally binding agreement for Ansbury to transfer 20 per cent share of its equity in the venture to Whitmore, such that OODP BVI equity would change to 60 per cent for Whitmore and 40 per cent for Ansbury.
Besides, the court was confronted with the decision whether the parties made a legally binding agreement to convert an outstanding loan of $150 million (plus interest) into shares in Oando E&P Holdings Limited.
In its ruling, the court said the draft amended loan agreement as well as the draft “Put and Call Option Agreements” never became effective.
“Whitmore is in breach of the repayment obligation in the First Loan Agreement,” the tribunal ruled. “The alleged oral agreement to switch the parties’ respective shareholdings in OODP BVI is not binding on the parties. The alleged oral agreement to extend the term of the loans to 1 January 2020 is not binding on the parties.”
Mr Moja said the final award was expected to follow in the next few days whereby the tribunal would make definite pronouncements on accrued interests on the debts owed and legal expenses.
He said the tribunal’s ruling is in respect of a debt Mr Tinubu is owing, and does not affect Mr Volpi’s status in Oando as its majority shareholder.
He said in line with the tribunal processes, details of the award have since been communicated to all the parties concerned since July 9. The ruling is, however, subject to appeal.
How Crisis Started
In 2012, Ansbury said it invested about $700 million in OODP BVI, by acquiring a 61.9 per cent stake in the firm, with Withmore Limited holding 38.10 per cent.
According to Mr. Volpi, Mr Tinubu approached him to invest in the company at a time Oando PLC was mobilising $1.5 billion to acquire assets in ConocoPhillips’ upstream oil and gas in Nigeria.
Similarly, OODP BVI, which controls 99.99 per cent equity in OODP Nigeria, holds 55.96 per cent of the stakes in Oando.
When the dispute broke out in 2017, Ansbury said it equally petitioned the Nigerian capital market regulatory authorities, the Securities and Exchange Commission (SEC) in May accusing the management of Oando PLC of mismanagement, “insider dealings, manipulation of the company’s shareholding structure and huge indebtedness”.
The petition culminated in the forensic audit of Oando PLC operations ordered by SEC in October 18, 2017.
But, the exercise did not take off several months after following the suspension from the office of the former Director-General of SEC, Mounir Gwarzo.
MUNIR-GWARZO
Although Abdul Zubair was appointed acting DG to succeed Mr Gwarzo, he was redeployed on April 13 and replaced by Mary Uduk, whom critics say was brought by the minister to do her bidding.
Months after the audit by KPMG commenced, aggrieved shareholders under the platform of Proactive Shareholders Association of Nigeria (PROSAN) accused the management of the company, a fortnight ago, of working with the Minister of Finance, Kemi Adeosun and Mrs Uduk, to frustrate the release of the audit report.
The shareholders blamed the long delay in releasing the audit report on Mrs Adeosun and Ms Uduk’s alleged clandestine activities “to shield Oando management from criminal prosecution”.
“We are calling on the Acting Director-General of SEC to immediately release the report of the forensic audit conducted on the company since last year although we believe the result will be compromised since they have failed to suspend the management of the company while the so-called forensic audit lasted,” National Coordinator of PROSAN, Taiwo Oderinde, said on Sunday
Oando Speaks
When contacted, the spokesperson of Oando, Mr Alero Balogun, denied the allegation by Oando shareholders that the management was sitting on the forensic audit report.
“We (Oando PLC) are not sitting on any audit report. We went to court to challenge the audit, because we said SEC would not be fair. We lost. Now the the audit has begun and they are saying it is taking too long. We are also waiting for the report of the audit like every other person,” she said.
