It is not yet uhuru as Oando PLC is facing a chancy court judgment that will define the survival of the company in years to come.
The London Court of International Arbitration (LCIA) had issued an award against two companies owned by the chief executive officer of Oando Plc, Mr. Wale Tinubu and Mr. Mofe Boyo, his deputy, to pay a total debt of US$680 million (equivalent of N244.8 billion) to Ansbury Investments Inc, which is owned by Mr. Gabriele Volpi.
The Nigerian Stock Exchange suspended trading in the shares of Oando Plc from October 20, 2017, though it later suspended the directive.
But, on July 6, 2018, the LCIA ruled that Ocean and Oil Development Partners (OODP) British Virgin Islands, which owns 55.96 per cent of Oando PLC through a holding company named Ocean and Oil Development Partners (OODP) Nigeria Ltd, is indebted to Ansbury Investment Inc. to the tune of US$600 million (equivalent of N216 billion).
Confirming this in a press release on Sunday, Mr. Andrea Moja, an international lawyer and counsel to Ansbury Investment, confirmed the LCIA award and that the Court also held that a company known as Whitmore Asset Management Limited, whose ultimate beneficial owners are Wale Tinubu and Mofe Boyo, are indebted to Ansbury Investment to the tune of another US$80 million (N28.8 billion).
This brings the total debt owed by the Oando managers to Ansbury Investment to US$680 million.
Documents obtained from the LCIA, which is reputed to be one of the world’s leading international institutions for commercial dispute resolution, identified the family of a Nigerian-Italian, Mr. Gabriele Volpi as the ultimate beneficial owner of Ansbury, while Mr. Wale Tinubu and Mr. Mofe Boyo are the ultimate beneficial owners of Whitmore Assets Management Limited.
The London Arbitration Court held that an existing “Third Shareholders Agreement” between the parties is fully and legally binding on the parties as claimed by Ansbury Investment.
The documents indicate that a final award in which the court will pronounce on accrued interests on the debts owed and legal expenses incurred by Ansbury will follow in the next few days. The LCIA award has been communicated to the parties concerned since July 9, 2018.
The Ansbury statement reads in part: “The award has been communicated to the parties on July 9th, 2018 and the key terms are as follows:
“The claim of Whitmore Asset Management Limited that the parties agreed to a binding Fourth Shareholders Agreement was rejected. The court upheld the position that the Third Shareholders Agreement is fully and legally binding between the parties as stated by Ansbury Investments Inc.
“The alleged agreement by which Whitmore Asset Management Limited was to hold 60% Of Ocean And Oil Development Partners (BVI) Limited is not binding on the parties.
“Ocean And Oil Development Partners (Bvi) Limited owes a debt to Ansbury Investments Inc for an amount of US$600 million.
“Whitmore Asset Management Limited owes a debt to Ansbury Investments Inc for an amount of US$ 80 million.
“This partial award will be followed by a Final Award in which the London Court of International Arbitration (LCIA) will pronounce on interests on the amounts owed and legal expenses.
“Given the above, Ansbury Investments Inc will immediately submit an application to London Court of International Arbitration (LCIA) in which it will be asked to charge Whitmore Asset Management Limited for all the due interests and legal expenses as well.”
In 2012, Ansbury reportedly invested about $700 million in Ocean and Oil Development Partners Limited (OODP BVI), a special purpose vehicle registered in the British Virgin Islands by acquiring a 61.9 per cent stake in the firm, while a company owned by Tinubu, Withmore Limited, held 38.10 per cent of the stake in OODP BVI.
Tinubu had approached Mr. Volpi to invest in the British Virgin Islands-registered firm when Oando PLC was seeking to acquire ConocoPhillips’ upstream oil and gas assets in Nigeria for $1.5 billion. OODP BVI, in turn, owns 99.99 per cent of the shares of Ocean and Oil Development Partners Nigeria Limited (OODP Nigeria), which holds 55.96 per cent of the shares in Oando.
When the disagreement broke in 2017, Ansbury also petitioned the Securities and Exchange Commission (SEC) in May accusing the management of Oando PLC of mismanagement, cooked books and huge indebtedness.
The petition was titled “Serious Concern to Corporate Governance Existence, Gross Abuse of Corporate Governance and Financial Management in Oando Plc – Request for Urgent Regulatory Intervention.”
In the petition, Ansbury cited page eight of the company’s annual report of 2016, alleging that a “strong uncertainty regarding the going concern status of the group had already arisen in 2015 and strengthened in 2016 as clearly pointed out by the auditors in their report”.
The petitioners also alleged that “operational management closed with a consistent loss of over N7.68 billion, significantly worse than 2015”, arguing further that “the net loss for the year from continuing operations in 2016 amounted to N25.8 billion, adding to the net loss of N34.9 billion of the previous year (2015)”.
Ansbury also informed SEC that Oando’s “current liabilities as at December 31, 2016, far exceeds the current assets by N263.7 billion, confirming serious financial imbalance from the previous financial year”.
The petition culminated in the suspension of Oando’s shares on the floors of the Nigerian Stock Exchange (NSE) and the Johannesburg Stock Exchange (JSE) in October 2017. The suspension was however lifted on April 11, 2018.
SEC has since ordered a forensic audit of Oando’s financial records.
Oando refutes Volpi’s claim on London Court of International Arbitration ruling
Meanwhile, Oando Plc described as untrue that the London Court of International Arbitration (LCIA) ordered its Group Chief Executive, Mr Adewale Tinubu, and the Deputy Group Chief Executive, Mr. Omamofe Boyo, to pay $680 million to Gabriel Volpi, the owner of Ansbury Investment Incorporated.
The company stated this Monday in a statement in response to a press release on the LCIA’s ruling issued by the lawyer and legal counsel of Ansbury Investment Inc. Mr. Adrea Moja.
The statement read, “The LCIA ruling follows months of arbitration on a loan repayment dispute between Oando Plc’s Group Chief Executive, Adewale Tinubu, the Deputy Group Chief Executive Omamofe Boyo, beneficial owners of Whitmore Asset Management Limited and Gabriel Volpi the beneficial owner of Ansbury Inc.
”The dispute dates back to 2017 when Gabriel Volpi allegedly attempted to breach a loan repayment agreement between him and Whitmore Limited in the British Virgin Island.
“Ansbury and Whitmore Limited incorporated, a joint venture investment vehicle in the British Virgin Islands called Ocean and Oil Development Partners (OODP BVI). OODP BVI, owns a 99.99% stake in Ocean and Oil Development Partners (OODP Nigeria) who in turn owns 57.37% stake in Oando PLC.
“Contrary to media speculations, the LCIA had, in fact, ruled that OODP BVI in which Gabriel Volpi owns a 60% stake should pay Ansbury (his own company) a total sum of $600 million, while Whitmore pay Ansbury $80million.
”Going by the ownership structure, this implies that Gabriel Volpi would, in fact, be paying himself $360 million. Payment terms are yet to be released by the LCIA and is expected to be made known to the parties in due course.