Concern As Oando Plc Sets To Quit NGX (Stock Exchange)

There are growing concerns over the dwindling fortune of Oando Plc under the leadership of Mr. Wale Tinubu.

ENigeria Newspaper reports that Oando Plc has not had it easy for some time now. Among the web crisis rocking the embattled oil firm include sanctions brought upon it by the Securities and Exchange Commission (SEC) over an alleged investigative discovery falsification of its financial statements, to a series of court cases initiated by aggrieved shareholders who felt marginalized among other rising issues.

The allegation was raised via a petition by one of its key shareholders. This led to the suspension of Oando from the exchange and a forensic audit of its books was ordered.

There have been reports suggesting that Oando Plc may stop trading at the Nigerian Exchange (NGX). This is following alleged plots to buy out the 42.63 percent stake of the company’s stocks held by minority investors. The development continues to unsettle shareholders who are already locked in a battle to finish with Wale Tinubu and 11 other partners of the company.

Oando Plc enlisted on the NGX and the and the Johannesburg Stock Exchange (JSE) continues to suffer sanctions from regulatory authorities over multiple cases of alleged infractions and fraud.

On March 25, 2021, about 14 shareholders of the firm with a stake of 299,257,869 shares of Oando led by Venus Construction Company Limited filed a petition and asked the Federal High Court in Lagos to direct either Ocean and Oil Development Partners Limited (OODP) or Oando to buy out their entire shareholding.

In the suit filed before the court, the petitioners listed OODP and Oando as the 1st and 2nd respondents respectively. The first respondent has a shareholding of 57.37 percent in the second respondent.

While giving an update on the matter, Oando said the court has granted the prayers of the minority investors and has ordered that a Scheme of Arrangement for the purchase of the shares of all the minority shareholders in Oando before carried out and within 30 days, a Scheme Document should be produced and submitted to SEC and NGX “as may be necessary.”

The court also directed the company to “convene within 120 days a meeting of the holders of its fully paid ordinary shares or their duly authorised proxies/personal representatives (where it becomes impracticable for any of the holders to attend or vote at a meeting) to consider, and if thought appropriate, approve (with or without modifications) a proposed Scheme of Arrangement by OODP Nigeria for the purchase of all the minority shareholders’ shares in Oando Plc.”

In the notice filed to the stock exchange and signed by the company secretary, Ayotola Jagun; and the Head of Corporate Communications, Alero Balogun, it was stated that if the sale scales through after a court-ordered meeting, Oando shares will be delisted voluntarily on the NGX in accordance with its guidelines for delisting of securities.

Shareholders Kick as Oando Plc Plans to Delist From Nigerian Exchange:

Punch Newspaper reports that some shareholders have expressed concerns over Oando Plc’s plan to delist from the capital market and acquire the shares of minority shareholders.

Oando in a corporate notice on Thursday informed the Nigerian Exchange Limited of its latest plans.
The company’s core investor, Ocean and Oil Development Partners Limited, proposed to acquire the shares of its minority shareholders at the rate of N7.07 per unit.

Oando had reported N34.7bn as profit after tax in the 2021 financial period and at the close of trading on Thursday, the shares of the company was N5.40 per unit on the NGX.

Part of the corporate notice read, “It is intended that the transaction will be executed through a Scheme of Arrangement in accordance with Section 715 of the Companies and Allied Matters Act, 2020 (as amended), and other applicable laws, rules, and regulations.
“Under the scheme, each scheme shareholder shall be entitled to receive the sum of N7.07 in cash or its equivalent in South African Rand (ZAR) for every ordinary share held by the qualified scheme shareholders at the effective date of the scheme.”

Reacting to the development, the Chairman of the Emeritus of the Independent Shareholders Association of Nigeria, Sunny Nwosu, slammed the company and said shareholders of Oando, who have not been paid in years, now have to deal with the acquisition of their shares.

He said, “In the last 10 years, shareholders of Oando have not received any dividend from them. You are selling the assets that have made NNPCL a super regulator and a super marketer; because they are the ones distributing the fuel that is being imported with taxpayers’ money; and now, they are also a super retailer. This is not part of corporate governance, this is cheating! We have seen a lot of disrespect for shareholders, especially for people who think they are doing good investments by going to the capital market.”

Also commenting, the Coordinator of the Sage Shareholders Association, Ibadan, Kehinde Olowolafe, said while it was within Oando’s right to exit the market, it was important that regulators ensure minority shareholders were not cheated.

He said, “The capital market is governed by laws, rules and regulations, and many companies operating in the market have the obligation to respect the rules that guide them. It is within the right of Oando Plc, having met the requirements to do so. The market is free entry and free exit. What I know is that the regulators must ensure that shareholders particularly minority ones are not shortchanged or cheated by the owners.”

On the N7.07 per unit proposed for the acquisition of the shares, Olowolafe said, “Although it is not favourable to us, during the EGM, we can talk to them to increase the price. There will be bargaining between the minority shareholders and the owners in order for us not to be cheated by the company.”

Meanwhile, Oando says it has applied to the Securities and Exchange Commission for a “No Objection” to the transaction.
The shares of Oando closed at N5.70 on Friday and at the close of trade on the NGX on Monday, the share appreciated by 0.88 per cent to close at N5.75.

Other companies that have delisted from the bourse include 11 Plc, formerly Mobil Oil Nigeria Plc, which voluntarily exited the NGX in 2021, Studio Press Nigeria Plc.