Hot Source*Bank fails to disclose N129bn in statutory report to NGX, raising questions
Alex Enumah in Abuja and Kayode Tokede in Lagos
The Attorney General of the Federation (AGF) yesterday clarified the swirling controversy surrounding the massive share purchases in FirstHoldCo Plc, saying that while the federal government was not a beneficiary of the transactions, it was fully aware of the trustee arrangement, Stanbic IBTC, a third party, set up by the company with the approval of the Central Bank of Nigeria (CBN).
This emerged as despite First HoldCo’s disclosure of the identity of the firm that acquired N195 billion out of the total value of N324.47 billion traded on Wednesday, it failed to reveal the individual(s) or entities behind the remaining N129 billion in its statutory report, raising further questions about the transparency of the transactions.
The AGF clarified that a trustee was set up by First Holdco, with the CBN approving Stanbic IBTC to oversee the transactions as a third party.
A statement by the Special Adviser to the President on Communication and Publicity, Office of the AGF and Minister of Justice, Kamarudeen Ogundele, stated that he was compelled to respond to THISDAY and Arise TV reports that had suggested that 25 percent of First Holdco’s shares were transferred to the Federal Government of Nigeria’s (FGN) trustee.
“Neither the Federal Government of Nigeria nor the Attorney General of the Federation and Minister of Justice participated in acquiring the shares in question.
“The Office of the Attorney General of the Federation and Minister of Justice debunks this falsehood to prevent confusion or misconceptions about First Holdco’s ownership and governance.
“The circumstances surrounding the shareholding structure are distinct from any government involvement. However, it is aware of a trustee set up by the First Holdco, with the CBN approving Stanbic IBTC to oversee it as a third party.
“We assure the public of continuous commitment to the promotion of the Rule of Law, Justice, equity, accountability, transparency and service to the nation by the administration of President Bola Ahmed Tinubu,” it stated.
Equally, First Holdco in a filing on the NGX signed by its Company Secretary, Adewale Arogundade titled, “Re: Rumor on First Holdco Plc sales of shares,” stated that its chairman, Mr. Femi Otedola did not purchase any of the shares in question, adding that neither did the federal government of Nigeria or any of its agencies, acquire the shares in trust.
“The sellers were Berbican Capital Limited & affiliates and Leadway Group & affiliates, and the buyer was RC Investment Management Limited,” First Holdco added in a two-paragraph statement.
First Holdco also revealed yesterday that a former Chairman of First Holdco Plc, and founder of Barbican Capital Limited, Mr. Oba Otudeko, sold N195.74 billion worth of shares to a trustee, a third party being managed by Stanbic IBTC.
According to a filing on the NGX yesterday by the holding company, of the 7,786,641,500 units of shares sold by Otudeko, 6,314,116,229 units were sold at N31.00 per share by Barbican Capital.
Arogundade in the separate statement posted on the NGX website, disclosed that sales of 6,314,116,229 units sold at N31.00 per share valued at N195.74 billion.
However, the disclosure was at variance with transactions recorded on the NGX on Wednesday, in which a total of N324.47 billion value of 10.47 billion units of First HoldCo Plc shares were traded in off-market block deals. This discrepancy raises further questions around transparency and compliance.
“Who owns the shares? Where did the money come from? What compliance was followed? Did it come from depositors’ funds? Are banks allowed under current regulations to buy their own shares? Why was it not disclosed in full? This is a huge transaction and requires to be fully disclosed,” a top stockbroker who pleaded to remain anonymous said.
A breakdown of the transactions on the holding company’s shares in a report seen by THISDAY showed that while Otudeko offloaded a total of 7,786,641,500 shares at N31.00 per share valued at N241.3 billion, Mr. Tunde Hassan-Odukale, the Group Managing Director of Leadway Assurance, sold 2,288,798,807 shares worth N70.8 billion at a price of N31.00 per share.
The breakdown further showed that Otudeko, in an off-market deal, offloaded: 5,875,980,151 units of shares in Barbican Capital Limited, 1,517,746,454 units of shares in Peace Account GASL Nominee, and 392,914,895 units of shares in RAML/MEF9.
For Odukale, the shares were sold through a mix of corporate entities and pension fund accounts that included: 1,036,914,805 units of shares in Leadway Holdings Limited, 432,258,388 units of shares in Leadway Assurance Co. Ltd, and 392,345,513 units of shares in UBAPC/Leadway Pensure PFA Ltd-T.
Others were: 323,563,889 units of shares in ZPC/Leadway Assur. Premium Coll. & Inv. A/C-T, 39,941,304 units of shares in UBAPC/Leadway Pensure PFA Ltd FundIII-T, 24,033,333 units of shares in ZPC/Leadway/NNPC Staff Pen Inv A/C-TRA, 6,037,543 units of shares in UBAPC/Leadway Pensure PFA Ltd FD1-T , and 30,701,032 shares units of share in Hassan-Odukale Tunde (direct).
Oba Otudeko, the erstwhile Chairman of FirstHoldco, was forced to sell off over 20 percent of shares linked to him. Also, another long-term shareholder, the Hassan-Odukale family, voluntarily exited the bank and sold five percent of their holdings in a mega transaction as they sought better shareholder value elsewhere.
The stock price of First Holdco this week gained N4.80 per share or per cent to close at N33.95 per share from N29.15 per share it opened for trading
