The lingering crisis in Oando Plc is far from over as a group of shareholders on Wednesday called on the embattled company’s management team led by its Group Chief Executive, Wale Tinubu to resign.
President of the Trusted Shareholders’ Association of Nigeria (TSAN), Alhaji Muktar Muktar, said the call on Tinubu and his team to resign has become imperative to save the company from collapse.
Mukhtar also took a swipe at the Securities and Exchange Commission (SEC) for not responding appropriately to shareholders’ demand in respect of alleged infractions in the company. According to Mukhtar, “Regulators have not done enough to protect shareholders in the whole Oando saga.”
While speaking in Lagos on Wednesday with newsmen, Mukhtar said, “Ernst & Young, the duly appointed independent auditors to Oando, having scrutinised the accounts of the company came up with a damning report that states in clear terms that the liabilities of the company have surpassed its assets by over N200 billion. The auditors further declared that there are serious concerns on the continuity of the company. Based on this report, the management of Oando should have been sacked and prosecuted, but nothing was done. This cannot happen in the US, UK, Europe and even Asia.”
He further said that it is shameful that while the company has been unable to pay dividends for the past four years, the executives have been travelling around in private jets and living large at the expense of shareholders. “Similarly, the management has continued to increase the remuneration of directors and board members while the company is left to die. This is a clear case of robbing Peter to pay Paul,” the TSAN President said.
“In other countries, what the regulator will do first of all if there are evidences or signs of infractions in any company, the management of the company in question will be sacked. I don’t know why Oando management board is still there. When some of these things happened in some banks when Sanusi Lamido Sanusi was the Central bank Governor, he sacked the management boards of all the banks that were culpable. Even recently, the Central Bank of Nigeria in exercise of its regulatory powers sacked the management and Board of Skye Bank in order to save the bank from collapse. SEC should have similarly acted in the Oando matter,” he said.
He said fresh hands and fresh ideas are needed to redirect the affairs of Oando and save it from haemorrhaging. “It is worrisome that the management running the affairs of Oando has been there for 19 years. That on its own supposed not to be so for a corporate organisation. It is high time they left the Board, especially now that there are disturbing issues concerning the affairs of the company,” he stated.
Last month, SEC placed the shares of the embattled company on technical suspension till further notice, following petitions from two of the company’s majority shareholders, Alhaji Dahiru Mangal and Ansbury Incorporated over alleged ‘insider dealings’ and ‘manipulation of the company’s shareholding structure’ in breach of the Investments & Securities Act 2007 and the SEC Code of Corporate Governance for Public Companies. The Johannesburg Stock Exchange (JSE) also placed Oando’s shares on suspension.
There have been series of protests against the company by various shareholders’ groups in various parts of the country.
Oando’s financial statement for the year ended December 31, 2016 presented by auditing firm of Ernst & Young was described as pretty damning. According to SEC, the allegations against the company were sufficiently “weighty” to deserve investigation in order to preserve all shareholders’ interest. The statement appeared to have confirmed the fears of the concerned shareholders, as details established the material uncertainty of the company as a going concern. Apart from a comprehensive loss for the year of N33.9 billion, against N56.6 billion in 2015, the statement said the company’s current asset exceeded current liabilities by about N14.6 billion (N32.8billion net current liability in 2015).