Telecom

O&O Network Appeals Court Order to Deposit N22.5Bn for Airtel Shares

Published

6 years ago

March 22, 2019

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O&O Network has filed a notice of appeal against the ruling of the Federal high court ordering it to deposit N22.5 billion with the chief registrar of the court pending the determination of the substantive suit.

Mojisola Olatoregun, presiding judge, stated that the sanctity of the court must be protected. She ordered further that the money should be kept in an interest yielding account in a commercial bank at the Central Bank of Nigeria interest rate.

Justice Olatoregun later adjourned till 29 May, 2019 for hearing of the substantive suit.

The $28,728,125 suit was jointly instituted by a Nigerian Industrial mogul Oba Otudeko and his company, Broad communications Limited against a cellular mobile telecommunications company, Airtel Networks Limited (formerly known as Econet Wireless Nigeria Limited )and 9 others.

The order of the court was sequel to an application filed before the court by the plaintiffs, Oba Otudeko and his company, Broad Communications Limited, urging the court to direct one of the defendants, O&O Network Limited to deposit the sum of N22.5 billion being the sum of a purported transfer of 16,002,404 shares of Airtel, into an interest yielding account in the name of the Chief Registrar of the Federal High Court to be domicile at Zenith Bank or First Bank pending the determination of the instant suit by the court.

Joined as co -defendants in the suit filed before a Federal high court in Lagos south west Nigeria are: a promoter of Airtel Jubril Adewale Tinubu, with 9,906,250 shares being 9.9% voting capital, O&0 Networks limited, Delta ministry of Finance Incorporated, Delta State Government, Corporate Affairs Commission, Econet wireless Limited, Econet Development Corporation,Ecobank Nigeria limited, Ecobank Transnational Incorporated.

The plaintiffs alleged that by order of the court issued on the 5th of February, 2015 the court mandated parties to maintain status quo in respect of shares held in Airtel Network Limited.

However notwithstanding the orders made by the court, O&O Network entered into arrangement for the sale and transfer of shares in Airtel Network limited to Bharti Airtel Nigeria BV. for the sum of N22.5billion.

The transfer of the shares to Bharti Airtel Nigeria BV, was alleged to be in violation of the order of the court.

According to an amended statement of claim filed on behalf of Oba Otudeko and Broad communications Limited by Chief Wole Olanipekun SAN, OFR, the plaintiffs alleged that sometime in 2011, Ecobank Transnational Incorporated acquired the defunct Oceanic bank Plc with all its liabilities and assets which at the time of acquisition included the 3rd defendant O&0 Network limited.

Prior to the acquisition of Oceanic bank the plaintiffs became aware that the 4th defendant, Delta State ministry of Finance incorporated and the 5th defendant Delta State Government purportedly transfer their beneficial ownership in the shares of the O&0 Network Limited back to 2nd defendant, Jubril Adewale Tinubu who subsequently purported to have transferred the shares to Oceanic bank Plc as part of a process of securitization and foreclosure arising from loans advanced to him by Oceanic bank.

The plaintiffs stated further that in the course of promoting Airtel, it was a fundamental term that in order to facilitate financing arrangements, Nigerian individual shareholders would take their shares in their own names or by the agency of their respective nominee vehicles. By this agreement Oba Otudeko was to hold directly or indirectly, 15% of the ordinary shares and Jubril Adewale Tinubu was to hold directly or indirectly about 10% of the ordinary shares of the company.

Further to the above arrangement and as preliminary step toward the acquisition of 40% equity stake in Airtel, Oba Otudeko and Adewale Tinubu through a special purpose corporate vehicle called First Independent Network limited FINL, executed a settlement agreement dated 11 June 2001,with Econet International Limited.

It was also selected fundamental term of the agreement that Nigerians would hold 40% of the ordinary shares and that Econet Wireless International EWI, being the original technical partner would hold 40%,while 20% was reserved for Transtel -a South African company.

Oba Otudeko took 13,035,936 shares in the name of Broad communication and 187,500 in his own name while Adewale Tinubu took 9,906,250 shares in the name of Ocean &Oil services and later transferred same to O&0 Network .

The shareholders agreement confers on the shareholders a’ ‘right of first refusal’ in relation to the disposal of shares or interest therein by any conceivable means;and outline procedures to be followed for giving notice of intention to dispose and further mechanism for dealing with such shares.

The plaintiffs alleged further that sometime in 2005, without any formal or informal notice they became aware that in 2001 and 2003, Jubril Adewale Tinubu acting as the alter ego of O&0 Network reached secret agreements to transfer all the company’s share in Airtel to Delta State ministry of Finance incorporated and Delta State Government for a premium.

The 9,906,250 ordinary shares of the O&0 Network sold, in breach of the plaintiffs pre -emptive right was valued at $4.50 thereby amounting to $44,578,125.

The transaction was deliberately concealed from the plaintiffs and other shareholders with Adewale Tinubu continuing to represent that he represented himself rather than the Delta State ministry of finance incorporated and Delta State Government on the board of Directors of Airtel.

The plaintiffs averred that Adewale Tinubu and one David Edevbie, the then commissioner for Finance and Economic Planning in Delta State made statements to the Economic and Financial Crimes Commission EFCC in or about August-November 2004 admitting that the respective transactions entered into between them had the sole objective of dealing in the shares of Airtel contrary to the agreement and the understandings binding parties and other shareholders in the Airtel company.

On 11th of March, 2013,the plaintiffs divested their interest in the Aitel Company.

The value of the 9,906,250 ordinary shares sold by Adewale Tinubu and O&0 Network to Delta State ministry of finance incorporated and Delta State Government in breach of the Plaintiffs pre -emptive rights had appreciated in value from $4.5 per share to $7.4 per share as at the time the plaintiffs divested their interest in the Airtel company amounting to $73,306,250, consequently the differential in the value of the shares when the plaintiffs divested their interest amounts to $28,728,125.

The plaintiffs claim against the defendants jointly and severally are as follows:

An order mandating the defendants to pay the Plaintiffs the sum of $28,728,125 being the interest /profit accrued on the 9,906,250, ordinary shares sold in breach of the plaintiffs pre -emptive rights in the Airtel Company.

Interest on same at the rate of 23% per annum from 15th July, 2003 till judgement is delivered.

Cost of this legal action assessed at N100 million.

However, In an affidavit in support of statement of defence sworn to by Airtel legal officer Kingsley Anyiam, filed on behalf of Airtel by a Lagos lawyer, Barrister C. A.Candide-Johnson SAN, the deponent averred that Airtel was not privy to the facts that led up to the dispute, as relayed by the Plaintiffs in their statement of claim.

In addition Airtel is not a party to the shareholders agreement which forms the crux of this dispute, as the shareholders agreement was entered strictly among the shareholders of Airtel as at the relevant time of this suit.

Consequently the Plaintiffs statement of claim do not have any adverse reliefs against Airtel. Therefore, Airtel need not be party to this suit in order to comply with any lawful order of the court.

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Telecom

Telcos Scale Down on Network Investments to Reduce Forex Losses

Published

23 hours ago

November 7, 2024

Comms Week

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MTN Nigeria Communications Plc and Airtel Africa Plc have reduced investments in network infrastructure to focus on minimising foreign exchange (FX) exposure and managing rising operational costs.

Telcos Scale Down on Network Investments to Reduce Forex Losses

According to businessday.ng, this was detailed in their financial statements for the nine months ending September 2024.

Their strategy aligns with earlier forecasts of decreased capital expenditure (capex) due to foreign exchange (FX)-induced losses in 2023 and 2024.

In recent weeks, Nigeria’s network quality has declined, a situation that Gbenga Adebayo, chairman of the Association of Licensed Telcom Operators of Nigeria (ALTON), attributed to reduced investments in the sector.

GSMA, the global telecom body, has warned that lower capex could lead to a shrinking telecom sector, resulting in poorer service quality and slower coverage expansion.

“The overall financial performance of the industry in recent years has not been sufficient to support the capital-intensive nature of the business,” it said.

Karl Toriola, chief executive officer of MTN Nigeria, recently noted that investments would not flow into a sector that cannot promise returns. “We are in a big crisis,” he said.

MTNN’s core capex spending fell by 27.79 percent to N217.64 billion from N301.38 billion year-on-year (y-o-y).

“Excluding leases, our core capex declined by 27.8 percent, resulting in a capex intensity of 9.8 percent on this basis. The optimisation of core capex enabled us to accelerate the reduction of forex exposure arising from our LC-backed obligations and its impact on the business,” MTNN said.

Airtel Nigeria’s capex fell 36.59 percent to $149 million in the first nine months of 2024 from $235 million in the corresponding period of 2023.

“Operating free cash flow was $163 million, up by 73.7 percent in constant currency, largely due to the constant currency EBITDA growth and lower capex while in reported currency,” Airtel said.

This slowdown coincides with reduced revenue earnings for Airtel and reported losses for MTNN. A Central Bank of Nigeria (CBN) unification of the foreign exchange market in June 2023 triggered a sharp devaluation of the naira, which plummeted from N471/$ before the move to N1043.09/$ by December 28, 2023, and N1676.90/$ by November 4, 2024.

Airtel Nigeria’s revenue fell 46.9 percent to $755 million, while MTNN’s losses increased from N14.99 billion to N514.93 billion, despite service revenue growing by 33.7 percent to N2.37 trillion.

Over the last two years, MTN has spent N1.08 trillion on capex, with Airtel Nigeria spending $545 million in the same period. Both declared FX losses of $1.56 billion in 2023.

Beyond FX losses, surging energy costs have also strained the operating budgets of telcos.

“Average diesel prices in Nigeria increased by approximately 90 percent compared to the prior period,” Airtel stated.

MTNN’s operating expense increased by 95.87 percent to N1.13 trillion from N575.46 billion.

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Telecom

AfriTECH 4.0 Holds in Lagos Today

Published

23 hours ago

November 7, 2024

Ugo Onwuaso

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The highly anticipated Africa Tech Alliance Forum [AfriTECH 4.0: https://africatechallianceforum.africa/] is scheduled to hold today Thursday, November 07, 2024 at Oriental Hotel, Lekki Road, Lagos-Nigeria.

The forum will bring together industry leaders, policymakers, innovators, and entrepreneurs to explore the theme “Leapfrogging Digital Transformation for Future of Africa’s Economy.”

AfriTECH 4.0 is poised to address critical conversations around the digital evolution of Africa, with a focus on key topics such as emerging technologies, sustainability, policy frameworks, and innovation in the tech ecosystem.

The forum will highlight the importance of building sustainable and inclusive digital infrastructures that can drive economic growth and social development across the continent.

Event Highlights Include: Keynote Presentations, Panel discussions, Networking Opportunities.

Also, the prestigious Africa Tech Alliance Excellence (ATAEx) Awards will recognize individuals, businesses and institutions leading digital transformation in Africa.

Special Guests:

Dr. Aminu Maida, a distinguished leader in telecommunications and digital transformation; Kashifu Inuwa Abdullahi, CCIE, a transformative leader in Nigeria’s technology landscape, currently serving as the Director General of the National Information Technology Development Agency (NITDA); Professor Ibrahim Adepoju Adeyanju, the CEO of Galaxy Backbone, a key government-owned technology and digital infrastructure company; Biram Fall, the Regional Managing Director, QNET, a leading e-commerce-based direct selling company; Ebehijie Momoh, the CEO of AfrigoPay Financial Services Limited, where she leads the company’s mission to provide innovative payment solutions across Africa.

Others are; Dr. Muhammed Sirajo Aliyu, President of the Nigeria Computer Society (NCS); Dr. Temitope Alakija, Senior Lecturer in the Department of Statistics at Yaba College of Technology [Yabatech] Lagos; Adesola Akinsanya – President, Nigeria Internet Registration Association (NiRA); Engr. Gbenga Adebayo, Chairman, Association of Licensed Telecommunications Operators of Nigeria (ALTON); Tony Izuagbe Emoekpere – President, Association of Telecommunications Companies of Nigeria (ATCON).

Also speaking are; Engineer Ikechukwu Nnamani – CEO, Digital Realty (Nigeria); Dr. Obadare Peter Adewale, Chief Visionary Officer, Digital Encode Limited; Mr. Emmanuel Amos, Founder – Programos Foundation/InnovationBed Africa; Chukwuebuka Ume-Ezeoke, Chief Technology Officer at CED Technologies; Dr. Oluseyi Akindeinde, Founder, Hyperspace Technologies; Happiness Obioha, Managing Director, Tecom Concepts Limited; Chukwuemeka Mbaebie, Convener, Lagos Blockchain Week; Akeem Ajisafe, Managing Director, Transblue Limited; Chika Nwosu, Managing Director, PalmPay; Jude Ozinegbe, Founder/Convener at Cyberchain; Mohammed Rudman, CEO, Internet Exchange Point of Nigeria [IXPN]; Dr. Ayotunde Coker, CEO Open Access Data Centres (OADC); Kehinde Ogundare, country manager, ZOHO [Nigeria]; Ayodeji Ogunmola, Director, Products Management at Northsnow Ltd; Oluwakayode Durodola, founder, Otuntech Limited; Lovelyn Okafor, Country Head, Nigeria at Newmark; Olaniyi Ibraheem, Business Development Manager (Africa) at UBankConnect; Adedamola Bowale, Co-founder & Technical Lead at Avancee Pinnacle, and Moniade Adeniyi, Product Innovation & Business Growth Strategist, Northsnow Ltd.

Meanwhile, innovationbed Africa is set to host “Startup Showcase” at AfriTECH, a session dedicated to startup finalists for this year’s United Nations World Summit Awards. Discussants include – David-Bobola Ojoawo, the Producer for Compas.AI; Stephen Adeyemo of Expertplug; Siro Collins, CEO of Advanced Engineering Center (AEC), WSA Winner 2023; Elijah Moses, Producer for VerionX; Rasheed Aliu Producer for LOOPBOX; Musami Umar Musam, founder of RollMal; David Ezeonyekwere, the founder of CheapMarketDeal, and Sule Wisdom David, the founder of CyclexAfrica.

QNET is the gold sponsor of AfriTECH 40. Silver Sponsors – Galaxy Backbone, Digital Realty, Digital Encode Ltd. Bronze Sponsors – CED Technologies, AfriGoPay, Tecom, Northsnow UK, Hyperspace Technologies, Palmpay, OADC.

Ecosystem Partners: NCC, NITDA,, InnovationBed Africa, ALTON, ATCON, NCS, IXPN, NiRA, Lagos Blockchain Week, Newmark Group, all are supporting AfriTECH 4.0.

Media Partners include; Techeconomy, NigeriaCommunicationsWeek, ITPulse, Ravenews, TechTrends.Africa, TechBuild.Africa, GrassRoots, DigiVation Network, TechLifewithUgo, BusinessMetrics, BusinessRemarks, SwiftReporters, TechTV, Africa Hyperscalers Media, CyberEra, ITRealms, DigitalTimes, TechnologyMirror, TechandBizNews, ITNewsNigeria.

“AfriTECH 4.0 will also feature interactive panel discussions, workshops, and exhibitions that will explore other critical topics such as artificial intelligence (AI), blockchain, fintech, smart cities, and sustainable innovation”, said Chike Onwuegbuchi, co-convener of AfriTECH. “We are grateful to the sponsors and partners”.

“Attendees will have the opportunity to engage directly with the speakers, as well as network with other industry leaders, innovators, and investors”, he added.

Participation

Online participants can join using the Zoom link here: https://shorturl.at/ETAPq.

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Telecom

MTN Foundation Celebrates 20 Years of Impact in Nigeria

Published

23 hours ago

November 7, 2024

Ugo Onwuaso

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MTN Foundation celebrated its 20th anniversary with a stakeholder conference in Abuja, highlighting two decades of significant contributions to communities across Nigeria.

This event provided a platform to reflect on the Foundation’s accomplishments, unveil a new logo, vision, and mission statement, and launch its Y’ello Impact Report, reinforcing its commitment to sustainable development.

The conference brought together prominent figures from both the private and public sectors, all gathered to honour the extensive impact of the MTN Foundation’s Corporate Social Investment (CSI) over the last 20 years.

A keynote address was delivered virtually by Amina J. Mohammed, Deputy Secretary-General of the United Nations, who commended the Foundation as a leading example of CSI in Nigeria.

“MTN Foundation embodies the transformative power of public-private partnerships. Its investment in education, healthcare, digital literacy and youth empowerment has touched the lives of countless individuals.

“By providing scholarships, supporting maternal and child health and helping young people develop skills for the future, the initiatives build resilience in our communities and create pathways for sustainable growth”

Guests at the event witnessed the unveiling of MTN Foundation’s new vision and mission statements along with its logo, heralding a new era of impactful initiatives where they are most needed.

“During this unveiling, the Executive Director of the MTN Foundation, Odunayo Sanya, emphasised the Foundation’s unwavering commitment to fostering sustainable growth within Nigerian communities and expanding its outreach across the nation.

“We have evolved over the years, but one constant remains: our desire to do more. We believe that so much more can be accomplished,” Sanya stated.

Sanya articulated the new vision of the MTN Foundation, which aspires to enhance the quality of life for all Nigerians and transform communities nationwide. “At MTN Foundation, we envision a Nigeria where no community is left behind.”

Sanya further outlined the Foundation’s mission moving forward, which encapsulates its commitment to holistic socio-economic development: “Our mission is to consistently enhance the well-being of our communities by fostering investments through collaborations and partnerships in capacity building, health, and economic empowerment.”

Panel discussions featuring recipients from various MTN Foundation initiatives highlighted its significant impact on women’s empowerment, education, music, economic growth, and community development.

Beyond celebrating two decades of achievements, this stakeholder conference served as a rallying call for private sector organisations to leverage their resources in partnership with government efforts to improve the welfare of Nigerian communities and promote sustainable development across the country.

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