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Oando Flays SEC over AGM Suspension

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  • Oando Flays SEC over AGM Suspension

Oando Plc has decried the last-minute suspension of its scheduled annual general meeting (AGM) by Securities and Exchange Commission (SEC). SEC had on Monday ordered the suspension of Oando’s AGM, which had been scheduled for yesterday in Lagos.

Oando’s share price depreciated by 2.60 per cent yesterday in post-announcement trading at the Nigerian Stock Exchange (NSE), representing a loss of N1.24 billion in market value. Oando’s share price dropped by 10 kobo to close at N3.75 per share.

In its official response to the suspension filed at the NSE, Oando stated that the cancellation of the scheduled AGM by SEC was not in the best interests of the Company and its shareholders who have travelled at great expense, from far and wide, to attend the AGM.

“The company also stands to lose significant shareholder funds by the attendant cancellation of the AGM at such short notice,” Oando stated.

Oando noted that it would take all legal steps to protect its business and assets whilst remaining committed to act in the best interests of all its shareholders.

The company said it would soon announce a new date for the AGM.

SEC had stated that the suspension was based on the Ex-parte order of the Federal High Court, Ikoyi, Lagos, which ordered status quo to remain.

Oando disagreed with SEC’s position pointing out that it had by notice to the public and its shareholders on May 10, 2019 validly convened its 42nd AGM.

“The actions contained in the SEC’s letter to the Company dated Friday, May 31, 2019 was effectively put in abeyance by the Ex-parte Order of the Federal High Court, which was granted on Monday, June 3, 2019,” Oando stated.

Several shareholders have also criticized the suspension of the AGM and other actions being taken by the Commission against the indigenous oil and gas company.

Shareholders under the auspices of Pragmatic Shareholders Association of Nigerian (PSAN) called on the Federal Government and other stakeholders to restrain SEC from creating unnecessary panic in the capital market.

According to the shareholders, the suspension of the AGM was counterproductive as both the company and its shareholders will bear the pains and financial burden of the cancelled AGM.

“Oando had planned and piad for this event as far back as May, what happens to all the money that was paid to the vendors to make the meeting a success? This is our hard earned money that has not been used judiciously as a result of SEC’s intervention,” PSAN stated.

SEC stated that it suspended the AGM until further notice to allow the parties maintain status quo adding that it would update relevant stakeholders and the public on the outcome of the ongoing litigation.

SEC had on May 31, 2019 released a statement indicting the management and board of Oando of sundry corporate governance abuses and infractions of the relevant capital market laws.

SEC barred the Group Chief Executive Officer (GCEO) and the Deputy Group Chief Executive Officer (DGCEO) of Oando from being directors of public companies for a period of five years. SEC also ordered certain members of board of directors of Oando to resign.

The apex capital market regulator stated that it had concluded investigation into alleged corporate governance abuses at Oando and found that the company was guilty of serious infractions and market abuses.

SEC also directed the payment of monetary penalties by the company and affected individuals and directors, and refund of improperly disbursed remuneration by the affected board members to the company.

SEC also directed the convening of an Extra-Ordinary General Meeting on or before July 1, 2019, to appoint new directors.

These among others the SEC stated, are part of measures to address identified violations in the company.

According to the SEC, following the receipt of two petitions by the Commission in 2017, investigations were conducted into the activities of Oando. Certain infractions of relevant laws were observed. The Commission further engaged Deloitte & Touche to conduct a Forensic Audit of the activities of Oando.

On June 2, 2019, SEC appointed an interim management team headed by Mr. Mutiu Sunmonu, a former Managing Director of Shell, to oversee the affairs of Oando and to conduct an extra ordinary general meeting on or before July 1, 2019 to appoint new directors to the board of the company, who would subsequently select a management team for Oando.

Oando however described the directives from the SEC as a calculated attempt to prejudice the business of the company.

The company stated that the alleged infractions and penalties are unsubstantiated, ultra vires, invalid and calculated to prejudice the business of the company.

According to the company, it has not been given the opportunity to see, review and respond to the forensic audit report and so unable to ascertain what findings were made in relation to the alleged infractions and defend itself accordingly before the SEC.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Finance

NAIC Pays N1.7bn Claims to Farmers

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The Nigerian Agricultural Insurance Corporation (NAIC) said it paid a total of N1.7 billion claims to over 5,000 farmers in the past two years.

NAIC, which is the only federal government owned insurance company authorised to offer agric insurance services to farmers at subsidised rate, said a breakdown of the paid claims showed that it paid N856 million to insured farmers in 2019 and N848 million in 2020.

Commenting on the development, NAIC Managing Director, Mrs. Folashade Joseph, said the claims were paid to the farmers to cover losses incurred in the course of doing business.

Joseph, enjoined agricultural investors and lending institutions to continue to partner NAIC by taking agricultural insurance cover that will enable them remain firm in business despite unforeseen circumstances from weather conditions and other risks in order to realise the food security agenda of President Muhammadu Buhari.

She said the above-mentioned amount was shared among five million farmers who suffered various setbacks in their farms as a result of natural course.

According to her, the NAIC Agric Insurance Scheme was launched in 1987 by federal government to restore the confidence and productivity of Nigerian farmers who suffered losses as a result of natural disaster such as flood, drought, pest and diseases.

The NAIC boss explained that the essence of the sensitisation campaign embarked by the corporation was to let the farmers know and understand exactly what NAIC does, the importance of insurance, and make them understand how insurance works, how they can access NAIC products and services, how to process their claims, as well as what insurance stands to do for them.

“Agribusiness is evolving fast and so many risks are being thrown up, many new participants are coming into the business of agriculture, and the risks are on the increase if you look at them across the value chain, there is no so many participants so we need to keep sensitising the farmers and let them know we are serving them, and we need to know from them how to serve them,” she explained.

Speaking further, she said, “our assurance to farmers is that when they are insured and they suffer losses covered by any of the policies they purchased, including natural disasters and whatever, they will get paid for their losses, and that is the purpose of insurance and setting up NAIC.

“Our motor is ‘Plowing the Farmer Back to Business, Plowing the Farmers into Prosperity’, and we settle claims.”

She said NAIC currently deals with thousands of farmers (Small, Medium, and Large scale farmers) across the country, adding that the corporation serves farmers with investment as little as N100, 000, and at the same time serves multinational farmers.

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Banking Sector

UBA Organises Capacity Building Forum

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As part of its commitment to support the growth and sustainability of micro, small and medium-scale enterprises (MSME) in the continent, the United Bank for Africa (UBA) Plc, is set to organise the next edition of its UBA Business Series.

The UBA Business Series which is a monthly event, is an MSME Workshop as well as a capacity building initiative of the bank where business leaders and professionals share well-researched insights on best practices for running successful businesses, especially in the face of the difficult operating environment that dominates the African business landscape.

Through this initiative, UBA has been assisting with essential tips to help businesses re-examine their models and strategies and ensure that they stay afloat and remain thriving, a statement from the bank explained.

The topic for the next edition of the series is, “Managing Performance for Business Growth,” and it will be held today, via Microsoft Teams.

At this session, the Managing Director, Secure ID Limited, Mrs Kofo Akinkugbe, will be sharing useful tips and insights on the key strategies of performance management to boost business growth.

Akinkugbe is the founder of SecureID Nigeria, a MasterCard, VISA and Verve certified Smartcard Personalization Bureau and Digital Technology company. She currently serves as the Managing Director/CEO, Secure Card Manufacturing, – a Smartcard manufacturing plant producing high security identity cards and documents for the Banking, Telecoms and Public sectors across Africa and beyond.

UBA’s Head, SME Banking, Sampson Aneke said of Akinkugbe, “with her vast experience garnered over the years from various sectors, she will help business owners understand how performance management strategies can be effectively implemented to ensure business growth.”

He emphasised UBA’s commitment and deep passion for small businesses, which according to him, remains the engine of any developing economy adding, “We know small businesses are the backbone of the economy in every country. In many climes, businesses with fewer than 100 employees account for 98.2 per cent of all businesses. This no doubt captures the importance of SMEs to a thriving economy which is why UBA is committed to seeing them flourish.”

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Banking Sector

CBN to Extend Credit Risk Management System to OFIs

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In an effort to curb growing bad debt, the Central Bank of Nigeria has said it will extend its Credit Risk Management System to Other Financial Institutions (OFIs) operating in Nigeria to protect them from bad debtors.

According to the apex bank, this is important following the successful implementation of the credit risk system in other lending institutions operating in Nigeria.

The bank disclosed this in a circular titled ‘Credit Risk Management System: Commencement of enrolment of all Development Finance Institutions, Microfinance Banks, Primary Mortgage Banks and Finance Companies’ and signed by Kelvin Amugo, the Director, Financial Policy and Regulation Department, on Monday.

In part, the circular read, “As part of efforts to promote a safe and sound financial system in Nigeria, the CBN introduced the CRMS to improve credit risk management in commercial, merchant and non-interest banks as well as to prevent predatory borrowers from undermining the banking system.

“With the successful implementation of the CRMS in deposit money banks, it has become expedient to commence the enrolment of Other Financial Institutions on the CTMS platform.

“Accordingly, all DFIs, MfBs, PMBs and FCs are required to report all credit facilities (principal and interest) to the CRMs and to update same on monthly basis.

“OFIs shall note the Bank Verification Numbers and Tax Identification Numbers are the only basis for regulatory renditions”.

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