Fireworks expected as Oando proxy battle moves to AGM
For many stock investors, particularly the equity holders in Oando Plc shares, the outcome of the company’s annual general meeting (AGM) which holds next week Monday in Uyo, remains what they look forward to.
This comes as a proxy battle for the company appears to be taking place.
A proxy fight or proxy battle is an unfriendly contest for the control over an organisation. The event usually occurs when corporation’s stockholders develop opposition to some aspect of the corporate governance, often focusing on directorial and management positions.
Oando Plc has been in the news recently, following two petitions filed with the Securities and Exchange Commission (SEC) that allege gross abuse of corporate governance and financial mismanagement.
The SEC has since commenced an enquiry in response to the petitions filed by Ansbury Incorporated (Ansbury) and one Dahiru Mangal.
Further to a statement by Oando Plc on July 14, 2017 on “claims of a SEC investigation”, the company recently refuted the claims, saying its position remains that the petitions have no merit, as the issues raised have received board, shareholder and where required SEC approval.
Ansbury, which claims that it has controlling interest in a company that has a major stake in Oando Plc, the listed company, alleges that the annual general meeting comes with the minimum notice “and not in Lagos to avoid any intervention and presence of Ansbury.”
Ansbury also wanted SEC to put on hold or postpone the General Meeting.
Their claim at the SEC, is that they are sidelined to take any decision in Oando Plc in line with their intension to: remove Wale Tinubu from the position of CEO of the company; to remove all the components of the Board of Directors; to reject any proposal concerning the remuneration of the CEO and the Directors of Oando Plc; and to reject the approval of the Annual Report 2016.
“The truth is that now the postponement of the AGM is a matter of public interest. It is true that if SEC will not postpone the AGM, it will allow a general meeting, where from one side, the minority shareholders will not be in the condition to vote properly, as they do not have the privilege of the full facts of the affairs of the company (that are instead, well known to SEC), and the major shareholder will be deprived of the opportunity to participate and vote at the AGM, from the other. SEC is fully aware of the situation and from the holistic point of view this is clearly against the fair functioning of the Stock Market,” Ansbury said.
“The petitioner is not a shareholder of the company, but a shareholder in a company domiciled in a jurisdiction outside Nigeria, which in turn holds shares in a Nigerian investment company that is a shareholder in Oando”, according to Oando.
“Dahiru Mangal is an individual who requested clarification from the SEC on issues which he could easily have obtained from the company and indicated in his petition to the SEC that he holds a 17.9percent interest in Oando.
“However, based on the company’s register of members, First Registrars Limited, he owns approximately 4percent of Oando Plc’s shares in his personal capacity. He is yet to disclose beneficial ownership of 13.9percent in accordance with Section 95 of the Companies and Allied Matters Act, Cap. C20 LFN 2004 (‘CAMA’); failure to do so is a violation of CAMA and this has been flagged by the company, in writing to Mangal and the SEC, since Wednesday, May 24, 2017.
“From the SEC’s initial correspondence to the company to date, we have availed them with all documents requested, provided clarification on, and rebuttals to, the issues raised and await a speedy conclusion to the enquiry. The company will continue to fully co-operate with the SEC in the discharge of its duties as the capital markets regulator.
“As a public company listed on both the Nigerian and Johannesburg Stock Exchanges, we will provide full disclosure of the outcome as soon as the SEC enquiry is completed,” Oando said in the statement.
Uncertainty from the proxy battle between major shareholders in Oando and the firm, has led to a slump in the stock price.
From a high of N9.54 per share in early May 2017, Oando Plc shares have been on the offer lately closing at N6.53 per share Wednesday, down some 30 percent in 4 months.
Following this development, many speculators in the market say they foresee a rowdy session when the company shareholders meet in Uyo for the AGM.
Amid this claims and counter claims on who owns what in the company, Sunny Nwosu, National Coordinator Emeritus, Independent Shareholders Association of Nigeria (ISAN) told BusinessDay that “the annual general meeting is not threatened”.
Nwosu said: “By every standard, if any shareholder does not have up to 5percent of a company’s shares, the annual report will not take notice of it. We are the biggest shareholders and we are not aware of any intension to remove the CEO of Oando Plc.
“We have seen the agenda of the AGM and there is nothing that shows it could be threatened. SEC knows that it has a big work to do in its investigations because Oando Plc is a big company and should consider decisions that protect the interest of the company’s over 250,000 shareholders,” Nwosu said on phone.
In the six-months (H1) to June 30, 2017 Oando Plc reported 26 percent growth in turnover to N267.1billion, compared to N212.3billion in H1’2016. Profit After Tax (PAT) rose by 117 percent to N4.6billion from loss after tax (LAT) of N26.9billion in the corresponding H1 of 2016.
Iheanyi Nwachukwu & PATRICK ATUANYA
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