Market Value Tumbles as Court Adjourns Shareholders Suit Against FBN Holdings
The Federal High Court sitting in Lagos has adjourned sine die (indefinitely), the suit filed against First Bank Holdings by the bank’s shareholder, Olusegun Samuel Onagoruwa, seeking to stop the annual general meeting of the bank.
Justice Akintayo Aluko adjourned the matter till further notice to allow the Lagos Division of the Court of Appeal to hear and determine an appeal filed by the Central Bank of Nigeria (CBN) seeking to join the suit as an interested party.
In the stock market, FBN Holdings market price tumbled strongly as shareholders continue to dump their shares. The financial institution has lost about half of its market value in weeks as internal discord continues. Recall, FBN chief executive officer, Adesola Adeduntan, abruptly resigned from First Bank of Nigeria Limited, its banking subsidiary and cash cow, in advance of his retirement in December 2024.
The financial services firm is well-known for its chronic internal animosity. With its historical antecedent, FBNH has higher numbers of vested interest. Stock market data suggests Ticker:FBNH has become more volatile compared to its peers. Its market value has crashed to N709 billion from about N1.4 trillion a few weeks ago.
Onagoruwa had filed an application urging the court for an order to stop the now-cancelled Extraordinary General Meeting of FBN Holdings earlier scheduled to be held on April 30, 2024.
In the application, which is yet to be heard, Onagoruwa is seeking the following reliefs: “an order restraining First Bank Holdings and its Board of Directors, their Agents, Employees, Servants, Officers, Directors, Privies, or anyone acting on their behalf or at their behest, from conveying, conducting and holding the first respondents’ Extraordinary General Meeting scheduled to hold virtually on the 30th day of April 2024, pending the hearing and determination of the substantive action.
Listed as defendants in the suit are: First Bank Holdings Plc, Alhaji Ahmed Abdullahi, the Chairman of the Board of Directors, Mr. Julius Omodayo-Owotuga, Non-Executive Director and Mr. Nnamdi Okonkwo, Group Managing Director.
At the resumed hearing of the matter on Wednesday, the lawyer to the defendants, Senior Advocate of Nigeria, Fred Onuobia, informed the judge that the business of the court is to hear their application challenging its jurisdiction, an application to set aside the Exparte order made by the court, and the petitioner’s contempt application against the defendants.
However, the lawyer to the CBN, Olumide Adebowale, urged the court to stay all proceedings in the suit. Adebowale told the court that his application was based on the appeal filed against the court’s ruling, which refused to join his client as a party in the suit.
He also told the court that the parties had exchanged briefs, and that the Court of Appeal had fixed July 3, 2024, for the appeal hearing.m,He, therefore, urged the court to adjourn the matter ‘sine die’ till the determination of his appeal.
In response, counsel to the petitioner, Adesoji Adedoyin, opposed the submission of the CBN’s counsel on the ground that there are contempt proceedings against all the defendants. He told the court that the contempt proceedings had to do with the court’s order granted on July 15, 2022, which all the defendants allegedly disobeyed.
Onuobia did not oppose the CBN’s application for adjournment. He said if the court proceeds to hear the petitioner’s contempt application, he will equally urge the court to listen to his application challenging its jurisdiction.
In a short ruling, Justice Aluko held that since an appeal is before the Court of Appeal, the best thing to do is to stay further proceedings to await the verdict of the upper court. Justice Aluko, consequently, adjourned the matter sine die.
