The Federal High Court of Nigeria today ordered mobile operator Bharti Airtel Nigeria Limited, to reinstate Econet Wireless’ 5% shareholding in the company. The judgement comes on the back of a long battle between Econet and Bharti Airtel Nigeria. Econet had opposed former owner Zain’s decision to sell its Nigerian business to Bharti Airtel.
The court also ruled that all actions and resolutions taken by the company since October 2003, at which EWL was entitled to be notified and to participate in as a shareholder, but was prohibited from doing so, are null and void.
“In October 2003, Econet Wireless Ltd received a letter from the chairman of the company – Mr Oba Otudeko, in which he advised that at a board meeting directors had decided that Econet Wireless was no longer a shareholder, Econet’s share certificate had been cancelled, and Econet’s name removed from the shareholder register.
The motive for this unprecedented action was the circumvention of Econet Wireless’ rights as a shareholder in order to facilitate the sale of shares, first to Celtel International, and later to Bharti Airtel,” said Econet Wireless Group Chairman Strive Masiyiwa.
“I am very disappointed that whilst it was clear to Celtel, Zain and Bharti-Airtel that Econet Wireless was a shareholder, they still chose to pursue a path, in which the end justified the means. It is clear even to those with the most basic understanding of company law that the board of a company has no power in any jurisdiction to simply cancel the shares of a shareholder but their desire to own the company was so great that they were prepared to overlook the facts and ignore our rights.
The court also ordered that the name change from Econet Wireless Nigeria Limited, effected in 2003, was irregular; and the Corporate Affairs Commission (CAC) has been ordered to cancel any certificate previously issued for the change of the name of the company and restore the name of the company.
Econet willing to negotiate:
“The board of Econet Wireless and I remain willing to sit down with Bharti-Airtel, to review the best way forward for all parties. In the meantime, we have a fiduciary responsibility to take all of the necessary steps to vigorously protect the interests of our shareholders.”
Charlie Fripp – Acting Online editor