Barbican Capital is controlled by Oba Otudeko, a former chairman of FBN Holdings.
FBN Holdings Plc and the Central Bank of Nigeria (CBN) have urged the Federal High Court Lagos to dismiss a lawsuit instituted by Barbican Capital Limited, an affiliate company of Honeywell Group Limited, seeking a declaration that its shareholding in FBN Holdings stands at 5.39 billion shares.
The two made the request on 8 August 2024, according to a court document obtained by PREMIUM TIMES, noting that "the case of the plaintiff is clearly academic and ought to be dismissed."
"We submit that the case of the plaintiff is tainted with mischief and malafide, hence, it qualifies as an abuse of the process of this Honourable Court," the document said.
Barbican Capital had earlier launched a legal action against FBN Holdings, claiming ownership of 5.39 billion in FBN Holdings.
FBN Holdings said it received a notification from Barbican Capital on 7 July 2023, where the latter stated it had purchased shares in the financial services group amounting to 4.77 billion units, equivalent to a 13.3 per cent stake on the entity.
Financial holding companies need a prior approval of the CBN , being the regulator od the banking industry, to be obtained before an acquisition of a shareholding of 5 per cent or above could be made in such companies, according to the CBN Guidelines for Licensing and Regulation of Financial Holding Companies in Nigeria (issued pursuant to the Central Bank Act of 2007 and Banking and Other Financial Institutions Act 2004).
Ownership of 5 per cent or more in a publicly listed company is considered significant shareholding.
In July 2023, Barbican Capital informed the CBN of its purported new shareholding, which surpassed the 5 per cent mark, seeking a "No Objection" approval from the regulator.
The CBN thereafter asked Barbican Capital to provide the documents that would aid the verification process of the shareholding.
FBN Holdings stated that it communicated the CBN's stance to the company and suggested it provide the documentation requested by the apex bank.
"The plaintiff (Barbican Capital) failed, refused and neglected to provide all the requested documents. Consequently, the CBN vide a letter dated 29th of Jan 2024 informed the defendant that it was only able to verify only 3,110,400,619 units of shares out of the plaintiff's then 4,770,269,843 billion shareholding due to insufficient documents," a court document said.
"The defendant (FBN Holdings) communicated the verification status to the plaintiff. The plaintiff has however failed, refused and or neglected to provide the relevant documents to the CBN till date."
FBN Holdings said it published its unaudited financial statement for the year ended 2023 in 2023 prior to the CBN letter of 29 January 2024, where it stated the plaintiff's shareholding to be 4.89 billion in accordance with the data sought from its members' register.
In its audited financial statements for the year end 2023, FBN Holdings revised Barbican Capital's stated shareholding to be in accordance with the verified by the CBN.
"Rather than regularise its status with the CBN by providing relevant documents to CBN necessary for the verification of its unverified shareholding, the plaintiff has instituted this suit in a bid to activate machinery of justice to compel the defendant to defy its regulator, due process, regulatory laws and policies," the document said.
On 15 July 2024, FBN Holdings sought an order from the court adding the CBN, being the regulator, to be added to the suit.
In a 60-paragraph affidavit deposed to on 8 August 2024 by Orjiakor Nwabueze, its deputy director of banking supervision, the CBN said Barbican Capital has not challenged the outcome of its verification exercise carried out as the supervisory and regulatory body.
It added that "In so far as the outstanding shares, being claimed by the plaintiff, to the tune of 2,340,599,305 shares (6.5%) remain unverified, plaintiff cannot claim any right/benefit on those shares."
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In a written address in support of third party (CBN) affidavit, lawyers to FBN Holdings said, "We submit that the substantive case as formulated by the plaintiff is, for all intent and purposes, incompetent for the simple reason that this honourable court lacks the requisite jurisdiction to entertain same."
"It is a case that ought to be dismissed for being academic and an abuse of court processes."
The lawyers argued that Barbican Capital intentionally hid the fact of an ongoing verification exercise by the CBN of its claimed significant shareholding and also advertently initiated the legal action to circumvent the verification exercise and the decision taken by the CBN against it.
The matter has been adjourned to 2 October for hearing other originating summons.
Barbican Capital is controlled by Oba Otudeko, a former chairman of FBN Holdings.
