Victor EzejaLagos-based Business lawyer, Chuks Nwachuku, has insisted that moves by Access Holdings Ltd to acquire controlling shares of First Guarantee Pensions Limited remain illegal despite media announcement of a successfully completed deal.
Prime Business Africa (PBA) also reports authoritatively that the matter is a now a subject of litigation as some of the shareholders have gone to court to enforce their Preemptive Rights as enshrined in the Company and Allied Matters Act (CAMA) 2020.
Nwachukwu, in a telephone interview with PBA at the weekend, said the CAMA is so strong that Access Holdings’ action without the blessing of all shareholders would not stand. According to him, ”the aggrieved shareholders should go to court because the law of Preemptive Rights of Shareholders with regard to a private limited liability company is so strong.”
Prime Business Africa had, several weeks ago, exclusively reported the Access Holdings’ takeover bid amid behind-the-scene moves by the management of First Guarantee Pensions Limited, to force some disagreeing members waive their Preemptive Right and allow Access Holdings acquire controlling shares of the firm.
READ ALSO: EXCLUSIVE: Access Bank’s Takeover Bid For First Guarantee Pensions Raises Dust
A source in Access Bank had denied the move in a chat with PBA, just as the management of PenCom in response to the multimedia platform’s inquiry said it was unaware of the move and would ensure that due process was followed in any such transactions.
READ ALSO: PenCom Reacts To Access Bank’s Takeover Bid For First Guarantee Pensions
According to a statement filed with Nigerian Exchange (NGX), Access Holdings Plc, the parent company of Access Bank, announced plans to acquire a majority equity stake in FGPL, one of the Pension Fund Administrators (PFAs).
Access Holdings said it has entered into an agreement with FGPL regarding acquisition of a majority equity stake in the company, noting that the deal is vital for the group’s plan of expanding beyond only banking to becoming a financial service holding company.
READ ALSO: Why Access Bank’s Takeover Bid For First Guarantee Pensions Fails On CAMA – Lawyer
Another report had also indicated that FBN Holdings has entered into an agreement with Access Holdings for acquisition of 100 per cent Share Capital of Access Pension Fund Custodian held by Access Bank Plc.
While these acquisition deals are being announced by the two financial service companies, a credible source in the pension industry revealed to Prime Business Africa that the deal between FGPL and Access Holdings did not receive the approval of all FGPL shareholders as required by relevant laws such as Companies and Allied Matters Act (CAMA) 2020 and the Memorandum of Understanding of the company which requires that all the shareholders must agree on the deal.
Prime Business Africa had reported that shareholders of First Guarantee Pensions had posed stout resistance of the move by Access Holdings to acquire the company as they complained that the process did not comply with provisions of CAMA 2020 as well as the set rules of engagement for PFAs in Nigeria.
The shareholders’ grouse was that the law required a statutory 28 days notice for an Extraordinary General Meeting (EGM), which according to them, management of FGPL did not comply with, making the shareholders suspect desperate moves to hurriedly conclude the deal.
It was also reported that the EGM was to make a special resolution to suspend the Preemptive Rights of shareholders, to enable Access Holdings take over by buying the shares of the FGPL shareholders.
When Prime Business Africa contacted PenCom’s Head of Corporate Communications, Mr. Abdulkadir Dahir, he stated that, for the Commission to approve the acquisition of FGPL, it means the company met all requirements.
“All the conditions must have been met before the commission gives a go ahead. If you are conversant with how the commission works, PenCom does not look at anybody’s face, we follow the rules and guidelines.
“For us to have given approval, it presupposes that all the requirements that are laid down by the law have been met,” Dahir told Prime business Africa.
PenCom had in a statement late last month in reaction to Prime Business Africa’s report about the takeover bid, said that “any investor interested in a PFA or any PFA interested in taking an investor, must comply with the provisions of Section 71 of the Pension Reform Act of 2014.” It added that it would only approve acquisition processes that do not violate set rules of engagement.
However, a source familiar with the acquisition bid said FGPL is in good financial status and does not need any form of divestment, but those managing the company with close contact to PenCom are pushing for the deal to sail through to cash out and make huge profit, thereby pressuring unwilling shareholders to accept it.
The source further stated that there is a reason behind their push to sell off the shares, and for Access Holdings to step in and buy, means that the PFA has good fortune hence, the attraction.
Victor Ezeja is a passionate journalist with six years of experience writing on economy, politics and energy. He holds a Masters degree in Mass Communication.
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