United Bank for Africa Plc (UBA) has filed a winding up petition before a Federal High Court in Lagos against a petroleum resources company, Sahara Energy Resources Limited, over an alleged inability of the firm to pay a debit of $42,282,430.49 (equivalent to N15,221,674,976).
In its reply, however, the management of Sahara Energy yesterday said it had no outstanding facilities with UBA, contrary to the petition the bank filed before the court.
In the petition it filed before Justice Mohammed Liman, the bank alleged that KEPCO Energy Resources Limited was desirous of raising capital requirements to fund the acquisition of 70 per cent share of Egbin power plant located at Egbin in Lagos State.
The bank filed the petition against the oil firm through his counsel, Mr. Temilolu Adamolekun,
To actualise the acquisition, UBA alleged, KEPCO applied to several Nigerian banks and finance houses for credit facilities and UBA was one of them (jointly referred to as the lenders.)
The bank averred that the lenders agreed “to provide KEPCO with the finance and credit facilities to the tune of respective commitment.”
The bank said as part of the security for the said facilities granted to KEPCO, Sahara Energy Resources Limited executed a sponsor guarantee and assurances deed wherein it stood as a corporate guarantor and undertook to irrevocably and unconditional pay to the lenders, including UBA, any unpaid balances and sums owed to each lender by KEPCO. It was on the strength of the guarantee given by the company that UBA agreed to grant KEPCO the facility.
Consequently, UBA availed KEPCO facility in the sum of $35 million in August 2013, according to the petition.
To manage the transaction as chronicled above, the lenders appointed FBN Capital Limited as the facility Agent and First Nigeria Limited as Security Trustee.
Pursuant to the failure of the company and KEPCO to perform their obligations to UBA, KEPCO applied for a restructuring of the facility.
Consequently, in May 2015, UBA extended the moratorium on the principal for KEPCO by a further 12 months and in October 2017, a second restructure of the finance facility was granted to KEPCO, increasing the facility from $35 million to $40 million.
Resulting from the above, as at December 31, 2018, the indebtedness of the company to UBA stood at $42,282,430.49, which is equivalent to N15, 221,674,976.4, the petition alleged.
The company failed to meet its obligations to the petitioner, UBA, in respect of the facility. The bank made several demands on Sahara Energy Resources Limited to fulfill its obligation as a guarantor in respect of the loan granted to KEPCO but all to no avail.
According to the petition, the company herein is insolvent and unable to pay its debt. In the circumstances, it is just and equitable that the company should be wound up, UBA insisted in the petition.
The petitioner, therefore, among others, prayed for an order that the company, Sahara Energy Resources Limited, be wound up by the court under the provisions of Companies and Allied Matters Act.
Meanwhile, based on a motion ex-parte application filed and argued by Adamolekun praying the court for an order for the petition to be advertised in one national daily newspaper, the presiding judge, Justice Mohammed Liman, ordered that the petition should be advertised in the Federal Gazette, and in one national daily newspaper.
Thereafter, Justice Liman adjourned till April 30, 2019 for the hearing of the petition.
In its response yesterday, the management of Sahara Energy stated that the company had no outstanding facilities with UBA, contrary to the petition. A statement on its website said the management had instructed its lawyers to take necessary steps to ensure UBA’s petition was dismissed.
“We assure our esteemed clients, bankers, suppliers, stakeholders and the general public that SERL and its legal team are taking all lawful steps to ensure that SERL interest is vigorously defended and SERL has implicit confidence in the Nigerian judiciary to resolve the matter and dispense justice between the parties,” the statement said.
Sahara Energy stated that it was not indebted to UBA and neither had any outstanding facilities with the bank nor borrowed any money from it in any loan transaction that was the subject matter of the civil petition. It also stated that it did not grant a direct guarantee to the bank on any loan transaction that the bank could unilaterally enforce or sue for.
The energy firm in its statement, said, “SERL and one of its affiliate companies, NG Power-HPS Limited, sued UBA in Suit No. FHC/L/CS/236/19 at the Federal High Court, Lagos, on February 13, 2019, claiming a number of declarative and injunctive remedies relating to unorthodox methods employed by UBA in relation to its dealings with the plaintiffs.
“UBA, on March 12, sued New Electricity Distribution Company Limited and SERL along with two other institutions, First Trustees Limited and Ecobank Capital Limited in Suit No. FHC/L/CS/382/2019, by way of originating summons, claiming certain declarations and injunctions to which SERL has filed full and comprehensive response.
“The two suits in paragraphs 3 and 4 have been set down for hearing before the Federal High Court in Lagos on May 30, 2019.
“While the above two suits are pending and have been set down for hearing, UBA commenced a third suit on March 13, and applied ex parte (and without putting SERL on notice before serving the petition) obtained an order ex parte to advertise the petition.”