The Securities and Exchange Commission has appointed Mutiu Olaniyi Adio Sunmonu as an interim management of Oando Plc, pending the constitution of a substantive management for the indigenous oil company.
Sunmonu was a former managing director of Shell Petroleum Development Company Nigeria.
His team will organise an Extra-Ordinary General meeting of the troubled company on or before July 1, where new directors of the company will be appointed.
In a statement on Sunday, SEC said: “Further to our press release on Oando Plc, dated May 31, 2019, the Commission hereby informs the public of the constitution of an Interim Management Team headed by Mr. Mutiu Olaniyi Adio Sunmonu CON, to oversee the affairs of Oando Plc, and 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 Plc. The Commission wishes to reiterate its commitment to maintaining integrity of the market.”
Sunmonu’s appointment came as Oando Chiefs, Wale Tinubu and Omamofe Boyo vowed to challenge in court the penalties imposed on them and the company.
Among the penalties imposed by SEC was the banning of Tinubu and his deputy from the directorship of any quoted company for five years.
SEC said Friday that its action followed a forensic report over alleged infractions committed by Tinubu and Oando board of directors, as alleged by two petitions filed against the company in 2017.
But in a statement by Ayotola Jagun, the board secretary, Oando said it has been denied fair hearing and therefore considered the ruling overboard.
“Oando is of the view that these alleged infractions and penalties are unsubstantiated, ultra vires, invalid and calculated to prejudice the business of the Company.
“The Company has not been given the opportunity to see, review and respond to the forensic audit report and so is unable to ascertain what findings (if any) were made in relation to the alleged infractions and defend itself accordingly before the SEC.
“The Company reserves its rights to take all legal steps to protect its business and assets whilst remaining committed to act in the best interests of all its shareholders”, it said.
SEC had said that a forensic report revealed serious infractions by the Company and as part of measures to address these violations, the Commission slammed the following penalties:
*Resignation of the affected Board members of Oando Plc,
*The convening of an Extra-Ordinary General Meeting on or before July 1, 2019, to appoint new directors,
*Payment of monetary penalties by the company and affected individuals and directors,
*Refund of improperly disbursed remuneration by the affected Board members to the company,
Bar of the Group Chief Executive Officer (GCEO) and the Deputy Group Chief Executive Officer (DGCEO) of Oando Plc from being directors of public companies for a period of five (5) years.
Oando’s problems with SEC began in 2017, following two petitions filed by two businessmen, who had interests in the company.
One of the petitions was from businessman, Alhaji Dahiru Mangal, who claimed to have 17.9 per cent of the company.
Oando claimed he has only 4 per cent and that he is yet to disclose the ownership of the remaining 13.9 per cent in compliance with Section 95 of the Companies and Allied Matters Act, Cap. C20 LFN 2004 (‘CAMA’).
Under a settlement brokered by the Emir of Kano, Muhammadu Sanusi 11, Oando officially confirmed Mangal as a substantial shareholder.
Oando also stated that in addition, subject to the provisions of the SEC Code, Companies and Allied Matters Act (CAMA) and Oando’s board appointment process, its board of directors would consider the appointment of a representative for Mangal to the board.
“The representation will take the form of directorship from qualified individuals nominated by Alhaji Mangal. All Directors have a fiduciary duty to always act in the best interest of the Company and its stakeholders,” said the statement.
Another petitioner was the Italian businessman, Gabriele Volpi. Volpi who runs the troubled Intels in Nigeria claimed he invested in Oando via his company Ansbury Inc, by making equity contribution to Oando’s purchase of ConocoPhillips Nigeria assets.
But Oando shot back that Ansbury is not a shareholder of the company, but a shareholder in a company domiciled in a jurisdiction outside Nigeria.
Ansbury, Oando said, holds shares in a Nigerian investment company by the name of Ocean and Oil Development Partners (OODP) that is a shareholder in Oando PLC.
Both petitioners wanted to cash out from the company, but Oando refused to play ball, because the company is facing a serious financial crisis, occasioned by the big fall in oil prices, soon after it paid $800 million to buy ConocoPhillips in Nigeria.
SEC in 2018 said the commission carried out a comprehensive review of the petitions and found out the company allegedly breached the provisions of the Investments & Securities Act 2007.
It said Oando breached the SEC’s Code of Corporate Governance for Public Companies and was also guilty of suspected insider dealing.
“The Commission’s primary role as apex regulator of the Nigerian Capital Market is to regulate the market and protect the investing public.”
SEC’s latest action was based on a forensic audit by Deloitte & Touche.
According to SEC, Oando and its Directors are to pay a total fine of N417.692 million for the various forms infractions the oil and gas company committed.
SEC disclosed this in a six-page letter dated May 31, 2019, that was addressed to the Chairman, Oando Plc.