OANDO Insider Dealing: Ex-DG SEC, Gwarzo Vindicated by London Court

Court of Justice

OANDO Insider Dealing: Ex-DG SEC, Gwarzo Vindicated by London Court
…Orders Tinubu, Boyo to Pay $680m
The suspended Director General of the Securities and Exchange Commission (SEC) Munir Gwarzo has been vindicated by the London Court of International Arbitration (LCIA) following the courts pronouncement that $680 million be paid to Ansbury Investments Limited owned by Mr Gabriel Volpi.
The development is contained in a statement signed by Zayyanu Umar Sanda, a Financial Consultant and made available to Economic Confidential in Abuja.
In a ruling delivered on July 6th 2018, the LCIA issued an award against Ocean and Oil Development Partners (OODP) BVI (who through their holding company Ocean and Oil Development Partners (OODP) Nigeria Ltd own 55.96 per cent equity in Oando PLC) and Whitmore Asset Management Ltd (owned by Wale Tinubu and Mofe Boyo) to jointly pay a total sum of US$680 million to Ansbury Investments Limited (owned by Mr. Gabriele Volpi).
The above judgement arose out of a dispute as to whether there was a legally binding agreement for Ansbury to transfer 20 per cent share of its equity in the venture to Whitmore, such that OODP BVI equity would change to 60 per cent for Whitmore and 40 per cent for Ansbury and also whether the parties made a legally binding agreement to convert an outstanding loan of $150 million (plus interest) into shares in Oando E&P Holdings Limited. The court however ruled that the draft amended loan agreement as well as the draft “Put and Call Option Agreements” never became effective.

SEC Boss Mounir H. Gwarzo
Suspended SEC Boss Mounir Gwarzo Vindicated by London
Court of International Arbitration

It will be recalled that in May 2017, the Nigeria Securities and Exchange Commission (SEC) had received 2 petitions against Oando Plc from 2 shareholders namely Alhaji Dahiru Mangal and Ansbury Investments Limited (owned by Mr. Gabriele Volpi) alleging amongst other things financial mismanagement, related party transactions, insider trading, huge indebtedness and falsification of financial statements.
The SEC set up a technical team to review the petitions and its report raised the issue of gross breaches of the provisions of the Investments and Securities (ISA) Act against the company. The SEC engaged the services of 5 independent professional parties to immediately commence a forensic audit on the activities of Oando Plc. However, according to the suspended DG of The SEC (Mounir Gwarzo), the Minister of Finance (Mrs. Kemi Adeosun) ordered him to stop the forensic audit and his refusal to do so eventually led to his suspension as the DG, SEC.
This interference by the Minister of Finance has caused adverse impact on market confidence and has created the perception of SEC as a regulator that is under political control. More importantly, the Ministers actions have marred SECs image in particular and Nigeria’s image in general in the international and regional capital markets and this is sending out wrong signals to foreign investors, whom it wants desperately to bring in money into the country as they will harbour the fear that their interests and investments will not be protected by government especially as seeing that the judgement passed by the LCIA all bordered on issues already raised by the SEC technical team that recommended the forensic audit.
Finally, the Minister of Finance at a public hearing before the House of Representatives Committee on Capital Markets on the 30th of January 2018, stated that the independent parties had since commenced the forensic audit and their findings would soon be submitted and the said findings would be released to the public. However, it has now been almost 6 months and the report is still yet to be submitted and released.

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