The London Court of International Arbitration (LCIA) has issued an award against the Chief Executive Officer of Oando Plc, Mr. Wale Tinubu, and his deputy, Mr. Mofe Boyo, to pay a total debt of $680 million (equivalent of N244.8 billion) to Ansbury Investments Inc., which is owned by Mr. Gabriele Volpi.
In its ruling on July 6, 2018, the LCIA held that Ocean and Oil Development Partners (OODP), British Virgin Islands, which owns 55.96% 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 $600 million (equivalent of N216 billion).
An international lawyer and Counsel to Ansbury Investment, Mr. Andrea Moja, confirmed the LCIA award in a statement on Sunday.
According to Moja, the Arbitration 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 $80 million (N28.8 billion). This brings the total debt owed by the Oando managers to Ansbury Investment to $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.
Whitmore and its ultimate beneficial owners, Wale Tinubu and Mofe Boyo, have been locked in a battle at the LCIA with Ansbury over a lingering disagreement concerning the shareholdings of Oando Plc.
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% stake in the firm, while a company owned by Tinubu, Whitmore Limited, held 38.10% of the stake in OODP BVI.
Tinubu had reportedly 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% of the shares of Ocean and Oil Development Partners Nigeria Limited (OODP Nigeria), which holds 55.96% 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 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.