Ecobank writes First Bank to halt Otudeko’s shares acquisition

Ecobank Nigeria Limited has urged First Bank of Nigeria Holdings Plc not to approve the 4.7 billion shares bought by Honeywell Group owned by Oba Otudeko over an alleged N13.5 billion debt owed it by the company and its promoters.

Recall that Oba Otudeko’s Honeywell Group on Thursday, July 6, 2023, bought 4.7 billion shares of the firm in a cross deal worth N87.8 billion.

In a letter written on its behalf by its lawyer, Oludare Amusan of Kunle Ogunba & Associates, Ecobank insisted that First Bank approving the transaction, is equivalent to assisting in the diversion of funds and assets meant for the payment of the debt which the Supreme Court has allegedly affirmed.

In another letter dated July 7, 2023, Ecobank demanded that the management of First Bank should, within seven days of the receipt of its letter provides it with details of the status of the transaction, stressing that the bank must not take any action which may be interpreted to encourage the subversion or the violation of the extant judgment of the Supreme Court, which allegedly mandated the Honeywell companies to pay their outstanding indebtedness, personally guaranteed by their alter ego, Oba Otudeko.

The acquisitions of First Bank of Nigeria Holdings Plc by Oba Otudeko took his shareholding to 14 per cent of the bank’s outstanding market value.

But in the letter, addressed to the chief executive officer of First Bank of Nigeria Holdings Plc, Dr Adesola Adeduntan, Ecobank claimed that it had instituted several lawsuits against Honeywell Group
Limited, Siloam Global Services Limited, Anchorage Leisures Limited, Honeywell flour Mills Plc and Oba Otudeko at the Federal High Court, Lagos to recoup the debt owed by the companies.

The letter further read, “Whereas the prior-mentioned entities had initially disputed their indebtedness to our client and had consequently filed an action in court to that effect, the Supreme Court on the 27th day of January 2023 in Appeal No. SC/CV/210/2021 delivered judgment affirming the indebtedness of the above persons to our client and further commanded that they must pay all the outstanding debts that have accrued under the loan contract between the parties.

“Which said indebtedness stood in the sum of N13,507,052,417.99, as of the 31st day of January 2023, whilst interest continues to accrue on the due debts as legally sanctioned by the Supreme Court of Nigeria, the highest court in the land.

“Instead of taking urgent steps to repay their indebtedness in line with the mandate of the Supreme Court, it has come to our notice that Dr Oba Otudeko (being the prime mover and alter ego of the debtor companies who personally guaranteed to repay the said debt) has taken active steps to divert his assets/funds and those of the debtor companies.

“Consequent upon the preceding crystalised facts, it is beyond doubtthat the actions being taken by Dr Oba Otudeko are targeted at diverting his assets and that of the Honeywell Group of Companies through the said Barbican Capital Limited, to frustrate the enforcement of the judgment of the Supreme Court against him and the Honeywell companies, towards recovering his/their undisputed indebtedness to our client.”