The bank said on the NGX that the virtual meeting, which was scheduled to take place on September 3, has been rescheduled. The purpose of the meeting was to seek shareholder approval for a N350 billion capital raising through a rights issue, private placement, or public offering.
The bank had stated in April that it intended to raise about N300 billion by issuing shares in the Nigerian or foreign capital markets through an IPO, private placement, or rights issue. In order to comply with the Central Bank’s increased capital requirements, Nigerian institutions are scrambling for cash.
A number of banks, including GTCO and Fidelity, have completed their capital-raising strategies, while major lenders such as Zenith and Access are nearing completion as well.
The postponement of First Bank’s AGM presents another obstacle to obtaining approval for its capital raising.
The recent high court decision that prevented the AGM from taking place is the reason for the postponement.
It took some time for First Bank to reply to a text message for comments.
A similar court decision by Justice I. N. Oweibo in the case brought against the bank by three shareholders, Olojede Adewole Solomon, Adebayo Oluwafemi Abayomi, and Ogundiran Emmanuel Adejare, made the bank’s annual general meeting last year appear to be in jeopardy.
First Bank insisted that it had not received any court orders prohibiting it from convening its 11th Annual General Gathering, and the virtual gathering did indeed take place.
A fixed amount of N50 million each for directors’ fees for the fiscal year ending December 31, 2024, and N63.7 million for the board chairman’s salary are also expected to be approved by the AGM, which has been postponed until September 3.
Femi Otedola, a billionaire investor, was named chairman of the controversial AGM held last year.
Multiple court records discovered by BusinessDay link certain of First Bank’s disgruntled shareholders, who have caused a shadow to fall over the bank’s AGMs, to the start of the bank’s seemingly never-ending legal fights.
Olusegun Samuel Onagoruwa, Kujenya Olayiwola Yusuf, and Hakeem Lawal-Oluwa are among the shareholders who have filed lawsuits contesting the validity of the AGMs, citing breaches of court orders that forbade such gatherings.
A number of cases are pending judgment at one stage of the court process, while others have been adjourned pending appeals in another.
FBN Holdings (FBHN) v. Olusegun Samuel Onagoruwa The 10th Annual General Meeting (AGM) notification was written long before the ink had dried in the simmering conflict between FBN Holdings and shareholder and accountant Olusegun Samuel Onagoruwa. The founder of Segun Onagoruwa & Co., Onagoruwa, has battled to stop the AGM in its tracks since 2022. Armed with an injunction barring any AGM-related activity, he and his legal team have defied FBNH’s ceaseless efforts to overturn this court order.
However, Onagoruwa’s team quickly countered this action by submitting objections that further complicated the process.
Onagoruwa’s case is currently at a standstill, awaiting the decision of the appellate court, while the Leadway case is scheduled to recommence on October 15, 2024.
FBN Holdings Plc & Others v. Leadway Holdings Ltd. A Struggle for Adherence
In a different sector of the legal system, Leadway Holdings Ltd. filed a complaint with the Federal High Court of Lagos, requesting that FBN Holdings Plc be ordered to call its annual general meeting. A recent regulation from the CBN raising the minimum capital requirements for banks is the impetus for this argument. Leadway contends that in order to comply with the Central Bank’s mandate, which takes effect on March 28, 2024, this AGM is not only a formality of procedure.
Hakeem Lawal-Oluwa, an unexpected defendant in the case, raises a red flag, which complicates the plan. Given the number of cases that are currently filling the courts with similar claims, he argues that Leadway’s action is unnecessary. Since it was started on April 30, 2024, there have been numerous court battles in this case. Leadway has vehemently refuted Lawal-Oluwa’s objections and counterclaims, which has resulted in a heated courtroom hearing on May 23, 2024.
Olayiwola Yusuf Kujenya vs. FBN Holdings Plc
A minority stakeholder in FBN Holdings Plc named Kujenya Olayiwola Yusuf is engaged in a legal dispute with First Bank regarding the validity of the AGM held last year. The August 15, 2023, meeting was planned to cover important resolutions, one of which being a major increase in the share capital of the firm. However, as the day drew nearer, Yusuf discovered that FBN Holdings was not allowed to host the AGM due to a Federal High Court decision, which had thrown a wrench into the plans.
The corporation ignored the court’s order and continued, passing the resolutions and updating its records with the Corporate Affairs Commission (CAC). Yusuf contends that these activities were not only unlawful but also a clear violation of his rights as a shareholder.
His complaint seeks to set aside all resolutions passed at the AGM, including the amended Memorandum and Articles of Association and the registration of new share capital. The next court hearing for the matter is October 3, 2024, and it is still pending. The CAC is also facing charges related to its involvement in registering the disputed documents.
The Securities and Exchange Commission v. Yetunde Olowoyeye
The Position of Minority Shareholders In a further twist, minority shareholder Yetunde Olowoyeye has challenged the power of the Securities and Exchange Commission (SEC), the Corporate Affairs Commission (CAC), and FBN Holdings Plc in an effort to protect the law. The contentious AGM of August 15, 2023, which Olowoyeye claims was convened in flagrant contempt of a court order given just days before on August 9, is another central theme of her action, which is filed under Suit No. FHC/ABJ/CS/1613/2023.
Olowoyeye contends that because the resolutions adopted at this AGM were formed in the furnace of court contempt, they are void. She claims that these resolutions violate shareholder rights under the Companies and Allied Matters Act (CAMA) 2020, and her lawsuit aims to prevent these resolutions from being implemented. In its response, FBN Holdings Plc calls into question the plaintiff’s standing and the court’s jurisdiction, calling the complaint an abuse of process because comparable problems are already the subject of an appeal.
Securities and Exchange Commission & Three Others v. Hakeem Lawal-Oluwa In court, Hakeem Lawal-Oluwa is also contesting the validity of the AGM from the previous year. Like the others, he contends that the AGM was called in clear violation of an August 9, 2023, court order that had temporarily barred the gathering.
The Securities and Exchange Commission (SEC), FBN Holdings Plc, and two other connected businesses are the defendants in this case and are charged with disobeying court orders. Lawal-Oluwa requests injunctions from the courts to stop any activity that could jeopardize his rights or circumvent the earlier verdict. However, the case has been placed on hold while relevant appeals are being resolved, just like so many other cases in this maze of laws.
Lawal-Oluwa contended in a separate lawsuit against the Attorney General of the Federation, Nigerian Exchange Group PLC, and the Securities and Exchange Commission (SEC) that the unlawful AGM had compromised his rights as a shareholder by waiving preemptive rights and increasing share capital, in addition to breaching proper procedures.
FBN Holdings’ Appeal: A Battle to Overturn an Injunction Against Olojede Adewole Solomon and Others
FBN Holdings PLC is fighting to reverse the initial injunction that clouded last year’s Annual General Meeting (AGM) in a separate court dispute. The center of attention for FBN Holdings’ legal approach is the injunction, which was obtained on August 9, 2023, at the request of Olojede Adewole Solomon, Adebayo Oluwafemi Abayomi, and Ogundiran Emmanuel Adejare.
The business contends that it was improper for the trial court to issue the injunction while the main lawsuit was still pending and needed comparable relief. Citing procedural shortcomings, FBN Holdings argues that the court lacks authority to impose the ruling. Moreover, the corporation maintains that an injunction cannot be used to prevent an AGM because it is a mandatory requirement under Nigerian law.
Undeterred, FBN Holdings filed an appeal with the Court of Appeal, requesting a delay of further proceedings in the matter in addition to overturning the injunction. The corporation contends that the lower court erred in its finding and that the injunction was the result of self-induced urgency rather than a true necessity.
An Apology in M.A. Banire & Associates v. FBN Holdings PLC
M.A. Banire & Associates, representing petitioners Olojede Adewole Solomon and others, have issued a clear plea for responsibility as the legal drama involving FBN Holdings reaches a peak. The law firm is extremely concerned about FBN Holdings’ willful disrespect for the August 9, 2023, interim decision from the Federal High Court that forbade the business from conducting its annual general meeting (AGM) on August 15, 2023.
FBN Holdings went ahead with the meeting and approved a controversial increase in its share capital in contravention of the court’s explicit instruction. Via their attorneys, the petitioners have pushed the Corporate Affairs Commission (CAC) to revoke the AGM’s resolutions’ registration, threatening legal action should they not follow the law. The petitioners’ resolve to have justice served, even if it involves taking the case to higher judicial authorities, is emphasized in the letter from M.A. Banire & Associates, which is signed by Muiz Banire.
