SEC directs Goodie Ibru to refund Ikeja Hotel over ‘unauthorised sale’ of Union Bank shares

The Securities and Exchange Commission (SEC) has directed Goodie Ibru and Associated Ventures International Limited (AVI) to refund Ikeja Hotel Plc (IHPLC) the monetary value of the shares held by the hotel in Union Bank Plc but sold by the businessman without approval.

This follows a forensic audit into the affairs of Ikeja Hotel, conducted by Akintola Williams Deloitte and commissioned by the SEC in 2018.

In a letter dated June 27, but released on Thursday and signed by Olubunmi Tadema, Ikeja Hotel secretary, the commission detailed a series of findings and issued binding directives aimed at resolving the governance crisis and restoring corporate accountability.

According to the SEC, Goodie Ibru and AVI must also transfer to IHPLC, the monetary value of shares in 13 quoted companies—including Texaco, Total, UBA, Mobil, Nigerian Breweries, Nestle, Guinness, and GTB—acquired using the proceeds from the unauthorised Union Bank share sale in 2001.

“That the Goodie Ibru/AVl having agreed to relinquish his interest should forthwith transfer to IHPLC, the monetary value of all the shares of 13 other quoted companies (Texaco, Total, UBA, Mobil Plc, Nigerian Breweries, Nestle Plc, Julius Berger, Cadbury, Lever Brothers, Guinness Plc, First Bank, BOC Gases and GTB) he purchased with the proceeds of the unauthorized sale of the one million (1,000, 000) units of Union Bank P/c shares in 2001, which belonged to IHPLC, along with all the dividends and bonuses that have accrued thereto,” the report said.

“The monetary value to be returned to IHPLC should be determined by the market prices on the various dates the identified shares were sold.

“That the misstatement of the indebtedness of IHPLC due to Associated Ventures International Limited (AVIL) in the sum of N1,226,753,000.00, in the Financial statement of IHPLC should immediately be restated by the current Interim Board of IHPLC to reflect the sum of N167,389,125.61, being the sum supported by documentation.

“That with respect to the indebtedness of IHPLC to Minabo Limited in the sum of N1,617,411,000.00 that arose from the sale of 3.753 acres of land to IHPLC by Minabo Limited, the said amount should remain recognized in favour of Minabo Limited in the Financial Report of IHPLC. The Deed of Lease having been confirmed, at the Lagos Land Registry, to be registered in favour of Minabo Limited on 28th October, 1980.

“That with regards to the 260, 125,062 units of Tourist Company of Nigeria (TCN) shares which belong to IHPLC, but was transferred to AVIL and Minabo Limited respectively in repayment of loans in the total sum of N985,873, 955.00, the Goodie Ibru/AVI should retain for himself, the entire 260,125,062 units of TCN shares transferred by IHPLC as repayment for loan amounting to N985,873,955.00 as approved by the board of IHPLC.”

The audit report further directed that, in line with the earlier settlement agreement dated February 17, 2017, the interim board of Ikeja Hotel should negotiate an appropriate exit package for Goodie Ibru/AVI in recognition of his role as former chairman of the company.

“That the Goodie Ibru/AVI should pay IHPLC and its investee companies (Tourist Company of Nigeria and Capital Hotels) the rental income for the period of occupancy as shall be determined by the companies and to be discounted at 40%,” the commission said.

“That the Alex Ibru/RFC/OMA group and StanbiciBTC Bank P/c should forthwith cease to occupy the rentable spaces in Federal Palace Hotel without payment of rents and should each pay outstanding rental charges of USD641,487.50(Six Hundred and Forty-One Thousand, Four Hundred and Eighty-Seven Dollars, Fifty Cents), (calculated from October 2008 to December 2017) and any subsequent period of occupation without payment to Federal Palace Hotel (FPH), to be discounted at 40%.

“That the Alex Ibru/RFC/OMA group should forthwith cease to occupy the rentable spaces in Federal Palace Hotel Penthouse without payment of rent and should pay outstanding rental charges of USD453,597.02 to TCN, to be discounted at 40%.”

In line with the directives arising from the forensic audit report, the commission also instructed that the N12 billion in shareholder loans reflected in Ikeja Hotel’s records be reduced by 40 percent for each shareholder, and that the company should immediately pay the adjusted balances to the respective shareholders.

This, according to SEC, would help restructure IHPLC’s balance sheet by removing the shareholder loans from its statement of financial position.

“All shareholders holding 10% or more of the shares of IHPLC must sign a shareholder agreement (SHA) in the form/structure approved by the SEC,” the report added.

The commission also ordered that the Alex Ibru/RFC/OMA Group must acquire the N36 billion shareholder loan owed by Ikeja Hotel within six months from the date the directives were issued

The SEC said the group is also required to buy out IHPLC’s 12 percent shareholding interest at the same price as the AVI buyout within the same period, instructing that both buy-out and purchase of the IHPLC loan must occur simultaneously.

‘TCN MAY CONVERT TO PRIVATE COMPANY AFTER COMPLETION OF TRANSACTIONS’

The commission added that upon conclusion of the purchase of the loan and shares, the SEC-appointed directors on the board of TCN would be withdrawn.

“TCN may also convert to a private company after the completion of the transactions stipulated in item 1 of this sub-heading and sequel to obtaining the approval of its minority shareholders for the conversion,” the SEC said.

“In the buyout of IHPLC loans in TCN, the Commission hereby directs a setoff from the amount payable out of the shareholder loan due to the Alex Ibru/OMA Group from IHPLC is hereby approved. Furthermore, there should be a 40% discount on the loan amount payable to IHPLC by Alex Ibru/OMA Group in the TCN loan buyout transaction.”

The commission also expressed confidence that the implementation of the directives would bring closure to the longstanding disputes as well as ensure the long-term sustainability of the company.