We are not party to wind-up court case instituted by Zenon Petroleum- Ardova Plc

Ardova Plc (NGX: ARDOVA) has stated that it is not a party to a court case instituted against its parent company; Prudent Energy & Services Limited.

Thisday reported on Sunday that Zenon Petroleum & Gas Limited has asked a Federal High Court in Lagos to wind up Prudent Energy and Services Limited, which is the parent company of Ardova Plc over the inability of the company to pay a $6 million.

In a press release signed by the Company Secretary Oladeinde Nelson-Cole, the company stated;

“Attention of the Management of Ardova Plc (Ardova or the Company) has been drawn to news circulated in various media publications on 8 August 2022, which seem to include Ardova Plc in a report of a “charge” to wind-up Prudent Energy & Services Limited (PESL) over an alleged inability to pay $6 million debt presented to the Federal High Court byZenon Petroleum and Gas Limited (Zenon).

Ardova Plc hereby states that the story is misleading and presents the facts of the matter as follows:

(i) The issues relate to the claims and warranties under the Share Purchase Agreement (“SPA”) between Ignite Investments and Commodities Limited (“Ignite”) and Zenon together with its
affiliates for the acquisition of shares in Forte Oil Plc (now Ardova Plc).

(ii) There are no claims against Ardova Plc as an entity. There are no winding-up petitions threatened or filed against Ardova Plc in respect of these issues or any other issue.

(iii) For the avoidance of doubt, Ardova Plc is not a party to any of the proceedings and the proceedings neither affect Ardova Plc’s rights nor create any liability for Ardova Plc in any way.

However, the Company has faith in the dispute resolution process and believe it will culminate in a just resolution of the issues. Ardova wants to avoid being drawn into a media spectacle and consider it important to clarify that this report relates to a dispute between former shareholders and a current shareholder and has nothing to do with Ardova Plc as a separate entity.

In the suit at the Federal High Court, Lagos, with No. FHC/L/CP/1450/2022, the debt was alleged to have arisen from the sale conducted in 2018 where Zenon Petroleum & Gas Limited and its affiliates sold 74.02 per cent of the issued share capital of Forte Oil Plc (now Ardova Plc.) to Sowami and Ignite Investment & Commodities Limited.

Alhaji AbdulWasiu Sowami is the Chief Executive Officer of Prudent Energy and Services Limited.

It stated that as security for the deferred consideration for the sale of the shares, Prudent Energy and Services Limited and Sowami had provided a guarantee in favour of Zenon Petroleum & Gas Limited and its affiliates for the prompt payment of the deferred consideration as at when due.

In the petition, Zenon Petroleum & Gas Limited alleged that the sum of $6 million being part of the deferred consideration became due on June 18, 2022, and despite the demand letters served on Prudent Energy and Services Limited and its CEO, the debt was not paid.

Zenon Petroleum & Gas Limited therefore urged the Court to wind up Prudent Energy and Services Limited on the ground of inability to pay its debts.

Zenon Petroleum and Gas Ltd was founded by Femi Otedola. In 2007, in May to be precise, Mr. Femi Otedola’s Zenon Petroleum & Gas Limited acquired NNPC’s stake in African Petroleum (AP). The acquisition made Zenon Petroleum the majority shareholder in the Company. Its name was changed to Forte Oil Plc in December, 2010, and its retail outlets nationwide were rebranded as well.

In 2019, Prudent Energy and Services owned by Abdulwasiu Sowami through Sowami’s investment company Ignite Investments and Commodities Limited acquired 74.02% equity stake in Forte Oil Plc’s downstream operations. The acquisition gave Abdulwasiu Sowami controlling shares of Forte Oil excluding the Geregu Power Plant.

In a special resolution passed by Shareholders at an Extraordinary General Meeting held on December 17, 2019, with the approval of the Corporate Affairs Commission, the company’s name was changed from Forte Oil Plc to Ardova Plc.

Read the story of Ardova Plc: Ardova Plc – The 56 years journey and a change of registered address