Shareholders Drag Ex-SGF Yayale Ahmed, Others to Court over Alleged Asset Stripping

Wale Igbintade

A former secretary to the Government of the Federation, Mr. Yayale Ahmed, and seven others have been dragged before the Federal High Court sitting in Lagos over alleged illegality in the management of the affairs of an Insurance company, Industrial and General Insurance Co. PLC.

The shareholders in suit number, FHC/L/CP/1699/2021, alleged that Ahmed and other respondents failed to abide by the law to hold the company statutory Annual General Meeting for over five years.

Also joined as respondents are, the company (IGI), it’s Managing Director, Mrs. Rachel Voke Emenike, Prof Oladapo Afolabi, Messrs Augustine Olorunsola, Kanayo Chuks Okoye, Gafar Kayode Animashaun and Abiodun Ajifolawe.

They were alleged to have embarked on “unrestrained asset stripping” by selling and transferring the company fixed assets without the approval of the shareholders authorising same.

The respondents were jointly accused of running the affairs of IGI PLC illegally in contravention of the provisions of the Companies and Allied Matters Act, 2000.

The petitioners are: Signet Ring Realty & Investment Limited, Dr Yinka Adedeji , Adefunke Adesola, Olayinka Olajuwon, Abiodun A. Akinjayeju, Olusegun Adekunle Wright, Igbekele Akinjayeju and Anthony Osae-Brown.

The suit is the third stage in the efforts by the petitioners in getting both the management and the board to conduct the affairs of the company in line with extant regulations and best practice.

The petitioners stated that they had earlier asked the board to call an Extra Ordinary General Meeting to intimate the shareholders of issues in the company.

Owing to the failure of the board to act, the petitioners also wrote to the regulator, the National Insurance Commission (NAICOM) and the Securities and Exchange Commission(SEC) seeking the intervention of the two regulators in the affairs of IGI Insurance.

The petitioners in their suit are praying the court for a declaration that the affairs of the 1st Respondent (IGI PLC) have been and are being conducted in a manner that is unfairly prejudicial and oppressive to the interest of the petitioners.

The Petitioners are also asking the court to declare the management of the affairs of the company by the respondents illegal for their failure to convene the statutory annual general meeting of the company, failure to declare and publish annual audited financial reports of the company and failure to give statutory reports of directors and auditors to the members of the company.

Subsequently, the petitioners are praying the court for “an order setting aside any or all acts of the 2nd-8th Respondents in purported exercise of the powers of such office and or respective offices without the approval and consent of the 1st Respondent’s shareholders at the Annual General Meeting as recommended by statute and Memorandum and Articles of Association of the 1st Respondent.”

The court was also urged to grant an order “that the respondents shall forthwith cause to be convening an Annual General Meeting of the 1st Respondent for the statutory business of the 1st Respondent at general meetings in compliance with S.237 of the Companies and Allied Matters Act, extant laws and the 1st Respondent’s Memorandum and Articles of Association.”

The court was prayed to order the Respondents to forthwith “cause the preparation and rendition of a true and accurate financial statement of the affairs of 1st Respondent for the years 2015, 2016, 2017, 2018, 2019 and 2020, such account to include, but not limited to accounts of all dealings in the fixed assets of the 1st Respondent and earnings, disbursements from and interests in the proceeds of such dealings.”

The petitioners further prayed the court to grant an order of injunction restraining the respondents, their agents and privies from further acts of negotiations, sale or utilisation of the company’s assets, pending when the Respondents render proper accounts on the assets sales of the company at the properly convened AGM.

In a 21-paragraph statement on oath deposed to by one of the petitioners, Mr. Abiodun Anthony Akinjayeju, the deponent submitted that the actions of the respondents ran afoul of the extant provisions of the law.

He stated that the respondents have “failed, refused and /or neglected to convene statutory Annual General Meeting (AGM) of the 1st Respondent, in flagrant disregard of S. 237 of CAMA” and that the last AGM of the company was held in 2016.

Akinjayeju deposed that the respondents failed or refused to render annual audited account/reports of the company to company members as well as embarking “on an unrestrained asset stripping exercise by their continued underhand sales and transfers of ownership of the 1st respondents’ fixed assets, without prior approval of shareholders’ authorising same.”

He listed the company’s assets sold to include landed properties in Ikoyi, Victoria Island, Lagos, Bodija, Ibadan in Oyo State, Kacyru Kigali, in Rwanda without authorisation from shareholders.

He noted that several letters have been written to challenge the alleged illegalities of the Respondents, but nothing positive was done to the complaints.

He submitted that all these actions have affected the fortune of the company and it has led to the company’s expulsion from the Nigerian Insurers Association, which invariably has affected their Investments in the company.

The petitioners stated that the affairs of the company are being conducted in a manner oppressive to them and therefore urged the court to grant their prayers.