Ecobank Nigeria Limited, ENL, has accused businessman Oba Otudeko of divert funds that should have been used to pay N13 billion owed the bank to buying shares in First Bank.
The commercial bank in a letter to First Bank Nigeria, FBN Holdings on Monday urged the parent company of First Bank Nigeria Limited, not to ratify the share purchase.
The letter comes on the back of last week’s “disclosure” by Barbican Capital Limited, a firm representing Otudeko that it has purchased over 4.7 billion shares in FBN Holdings. The landmark acquisition has made the business man the single largest shareholder in First Bank.
But amidst the controversy that the former First Bank Chairman is planning a comeback after he had been sacked from the commercial bank in 2021 by the Central Bank of Nigeria, CBN, Ecobank said the business mogul is trying to evade payment of debt owed it by playing the smart Alec, after revelation that Barbican Capital Limited, the firm that purchased the shares is a new company registered in March this year and is not among the legal entities covered by the apex bank judgment.
According to Ecobank, in a letter written by its legal counsel, ‘Kunle Ogunba & Associates and dated July 7, 2023, the Pan- African bank accused the chairman of Honeywell Group of playing smart Alec with his debt.
Recall that the Supreme Court had ruled that the debt should be repaid by Otudeko and his companies. Apart from this, Ecobank has also filed a bankruptcy case against the industrialist.
In the letter addressed to Nnamdi Okonkwo, the Group Managing Director, FBN Holdings, Ecobank stated that several lawsuits have been filed against Otudeko’s Honeywell Group and his other business concerns.
The bank cited the Supreme Court judgement of January 27, 2023, directing Otudeko to pay all his outstanding debt to the bank, adding that “instead of taking urgent steps” to repay the N13.5 billion loan, Otudeko is trying to divert funds from his companies, while interest on the loans is growing.
The letter reads in oart; “Please be informed that our client has instituted several lawsuits against Honeywell Group Limited, Siloam Global Services Limited, Anchorage Leisures Limited, Honeywell flour Mills Plc and Dr. Oba Otudeko at the Federal High Court, Lagos, in view of recouping the humongous indebtedness of the highlighted entities to our client.
“It is particularly noteworthy that Dr. Oba Otudeko personally guaranteed the loan leading to the humongous indebtedness of the prior-mentioned companies. 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.
“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. This, he has done, by using a company known as Barbican Capital Limited (special purpose vehicle) which was recently and hurriedly incorporated after the judgment of the Supreme Court (specifically on the 9th day of March, 2023)…
“It is beyond doubt that 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, in order 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.”
Warning that ratifying the shares is tantamount to aiding the diversion of the funds and assets meant for paying the humungous debt, Ecobank urged FBN Holdings to “respectfully stay/reject the approval/consent/registration/ratification” of the shares bought by Barbican Capital
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