The Federal High Court sitting in Lagos has further adjourned hearing on the petition filed by fourteen shareholders of Oando Plc (NGX: OANDO) that relates to the scheme of arrangement to buyout minority shareholders of the company to February 5th, 2024.
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Venus Construction Company Limited, acting by itself and for and on behalf of other minority shareholders of Oando, had on March 25, 2021 filed a petition requesting that the Court orders the buyout of their entire shareholding.
In a regulatory filing on Tuesday, Oando stated that adjournment to February 5th, 2024, is to enable a further report of compliance with the Court’s order dated June 7, 2022, directing the Company to file its Scheme of Arrangement document with the Securities and Exchange Commission (SEC) and the NGX within 30 days, among other orders.
Investogist reported in October that when the case was adjourned to November 28, 2023, the reason given was to “enable the Company provide a further report of compliance with the Court’s order dated June 7, 2022, which directed the Company to file its Scheme of Arrangement document with the Securities and Exchange Commission (SEC) and the NGX within 30 days, among other orders.”
Background History
Venus Construction Company Limited, acting by itself and for and on behalf of other minority shareholders of Oando, had on March 25, 2021 filed a petition requesting that the Court orders the buyout of their entire shareholding.
In response, Oando filed across-petition, stating its willingness to buy out all the minority shareholders of Oando via a court-ordered Scheme of Arrangement.
By June 2022, the Federal High Court ruled on the petitions granting an order that Oando had 30 days to prepare a Scheme Document for the purchase of all the minority shareholders’ shares in Oando Plc for submission to the Securities and Exchange Commission (SEC) and/or the Nigerian Exchange Limited (NGX).
At the time, OODP had a shareholding of 57.37 per cent in Oando PLC which has 12,431412,481 outstanding shares, and the above-mentioned minority shareholders had a 42.63% shareholding.
Ocean and Oil Development Partners Limited (OODP) owns 7,131,736,673 shares (representing 57.37% of the total number of shares) in the Company. OODP is ultimately owned 66.67% by the Group Chief Executive and 33.33% by the Deputy Chief Executive of the Company at year-end.
On October 18, 2022, the company informed the Nigeria Exchange that the Federal High Court had extended the timeline given to the company to acquire the shares of the minority shareholders of the company by 90 days.
On March 30, 2023,Oando notified the Nigerian Exchange Limited (NGX) and Johannesburg Stock Exchange Limited (JSE Limited) that its core shareholder, Ocean and Oil Development Partners Limited has offered to acquire the shares of all minority shareholders in Oando.
The Company said it will be subsequently delisted from NGX and JSE and re-registered as a private company.
According to corporate action notification published on the Nigerian Exchange, “OANDO Plc 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.”
Punch reported that some shareholders have expressed concerns over Oando’s plan to delist from the capital market and acquire the shares of minority shareholders.
The Coordinator of the Sage Shareholders Association Ibadan, Kehinde Olowolafe was reported as saying that ” 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.
Since the announcement of the scheme, Oando share price has risen to N16.00 from N5.70, and closed trading on Friday at N9.20.
Nnamdi Maduakor is a Writer, Investor and Entrepreneur
