The Securities and Exchange Commission (SEC) yesterday dissolved the board of directors of Ikeja Hotels Plc and ordered a forensic investigation into the affairs of the hospitality and tourism company. Chief Anthony Idigbe (SAN) is the interim chairman.
The apex capital market regulator said it sacked the board due to unresolved internal crisis involving some majority shareholders of Ikeja Hotels Plc, in apparent reference to the squabbles within the Ibru family, which holds the largest shareholdings in the company.
In a statement, SEC described the dissolution as a proactive measure to disallow the warring parties from taking certain actions that would give them an advantage over one another.
Ikeja Hotels, incorporated in 1972 and quoted on the NSE in 2007, controls a chain of hotels directly and through other subsidiaries and affiliates, including Tourist Company of Nigeria (TCN) Plc and Capital Hotel Plc. Ikeja Hotel. Sheraton Hotel, Ikeja, Lagos. TCN owns Federal Palace Hotel while Capital Hotel owns Abuja Sheraton Hotel. The Ibru family owns the single largest individual shareholding.
SEC noted that it had, in a bid to forestall chaos in the company, in conjunction with other distinguished personalities, held meetings with the existing board towards resolving the crises but the company continues to be plagued with unhealthy corporate governance practices in disregard of the code of corporate governance for public companies.
According to the Commission, as a public company, it is paramount that the activities of the company are conducted within the confines of corporate governance regulations in the Nigerian capital market, to ensure the protection of minority shareholders and other investors.
“Having failed to resolve its lingering crisis, the Commission in exercise of the powers conferred on it by the Investment and Securities Act, 2007 to protect investors and the integrity of the securities market, hereby approves the appointment of an interim Board for the company with Chief Anthony Idigbe, SAN as interim chairman,” SEC stated.
SEC told the interim board to oversee the conduct of a forensic investigation into the affairs of the company, among other responsibilities.
“It is the Commission’s expectation that the shareholders and key management staff of the company will work with the new team to ensure that the fortunes of the company are restored in the shortest possible time,” SEC stated.
The Nation had earlier reported that Nigeria’s apex capital market regulator, SEC was scrutinising an investigative report on the boardroom crisis at Ikeja Hotel, after the simmering ownership and management crisis within the Ibru family snowballed into a major onslaught by the Economic and Financial Crimes Commission (EFCC).
Capital market sources told The Nation that the regulators had dusted up investigative reports on Ikeja Hotel to review the facts and proactively act to protect shareholders’ interests.
A source at SEC said the apex capital market regulator had received a comprehensive report from the NSE, and the Commission had started reviewing the report in line with the market’s complaint management framework.
Authorities at the Nigerian Stock Exchange (NSE) had in November 2016 also suspended trading on the shares of Ikeja Hotels in apparent response to the high-stake dispute in the Ibru family.
In a suspension notice, the Exchange stated that it had suspended Ikeja Hotel, implying that no trading will henceforth take place in its shares. Unlike technical suspension where trading can take place without price movement, full suspension disallows both trading and price movement.
The Exchange noted that the full suspension was taken “to safeguard the investments of shareholders of Ikeja Hotel Plc following the continued dispute between the major shareholders which has negatively impacted on the company’s governance structure”.
The NSE pursuant to the provisions of rule 15.45: suspension on trading of securities, rulebook of the Exchange, 2015. The suspension took effect on November 10, 2016.