The Nation Newspaper

Tag: Newswatch

  • Dispute over Newswatch: More stakeholders join the fray

    The dispute over the ownership and management of the troubled news magazine, Newswatch has assumed a fresh twist as a new set of shareholders have questioned businessman-lawyer, Jimoh Ibrahim’s claim to majority shareholding in the company.

    Before now, the dispute had been between Ibrahim and some pioneer directors of the company: Ray Ekpu, Dan Agbese, Yakubu Mohammed and Soji Akinrinade. Few months after Ibrahim reportedly bought into the company, assuming 51 per cent holding, he took some decisions, including suspending publication purportedly to allow reorganisation.

    He also went before the Federal High Court, Lagos last year in suit number: FHC/CS/1054/2012. With the suit, he seeks to among others, strip Ekpu, Agbese, Mohammed and Akinrinade of their directorship status and prevent them from declaring a trade dispute between him, (with 51 per cent stake) and the remaining shareholders (with 49 per cent stake).

    This time, minority shareholders and former directors, NuhuWada Aruda and Professor Jibril Aminu are accusing the Ibrahim-led new management of allegedly assuming control of the company fraudulently and running it in a manner detrimental to the interest of other shareholders.

    Aruda and Aminu have initiated a fresh suit marked: FHC/L/CP/1367/2012 through a petition brought pursuant to sections 310 (a), (b) and (c) and 311(1), (2) (a) and (b) of the Companies and Allied Matters Act. They are praying the court to, among others, set aside the assignment on which basis Ibrahim purportedly assumed majority shareholding in the company.

    The initial suit, in which Justice Okon Abang is expected to deliver judgment in mid March, has Newswatch Communications Limited (NCL), Ibrahim and his company, Global Media Mirror Limited (GMML) as plaintiff, with Ekpu, Agbese, Mohammed and Akinrinade as defendants.

    In their originating summons, the plaintiffs are particularly praying the court to restrain the defendants from acting on behalf of the other shareholders who own the remaining 49 per cent stake.

    They argued that the defendants, with just 6.3 per cent cumulative share holding, and having resigned from the company, could no longer act for the company or its other shareholders. They set six questions for the court’s determination and sought six declarative reliefs and an order.

    They prayed the court to among others decide whether the respondents, having resigned from the company on May 5 this year, could continue to act for the company and parade themselves as its directors.

    They also want the court to decide whether or not the respondents, with just 6.3 per cent equity, could act for the owners of the company’s 49 per cent stake; whether in view of their minority share holding, the respondents could also declare, in law, give notice of trade dispute with the company and its Chairman.

    The plaintiffs urged the court to declare that the respondents, having resigned from the company, and their said resignation endorsed by the company’s board, they have ceased to by the company’s directors.

    They also want the court to declare that Ekpo and others, having resigned from the company, can no longer be referred to as its employees.

    In a supporting affidavit deposed to by Gloria Ukeje, the plaintiffs argued that Newswatch owed about N362,132,764.19 when Ibrahim bought into it and acquired the majority shareholding of N51 per cent.

    She stated that by the current shareholding structure of the company, the defendants do not have enough shares for them to be qualified to be on the company’s board.

    The defendants responded by filing objection and counter affidavit, in which they faulted claim by Ibrahim that he legitimately acquired majority shareholding in the company. They denied the businessman’s claim that they were no longer directors in the company.

    Ekpu, Agbese, Mohammed and Akinrinade stated that Ibrahim has consistently misrepresented facts in his claim to the ownership of the company. They admitted that parties actually entered a share purchase agreement, but that Ibrahim and his company, GMML in the company’s bid to raise funds to improve on its operations.

    They faulted Ibrahim claim that he has acquired the company. They contended that he failed, along with his company, to perform their obligations under the agreement.

    Ekpu, Agbese, Mohammed and Akinrinade accused Ibrahim of subverting the actual intention of parties to the agreement. They alleged that he has not demonstrated any intention of growing the company, but rather, has engaged in stripping its assets.

    They averred, in the counter affidavit deposed to by Akinrinade that by the agreement, Ibrahim and his company were required to pay N510million before May 5 last year, the completion date of the transaction, before they could take over the board of Newswatch and its management.

    They averred that Ibrahim and GMML failed to meet the said requirement by May 5, but instead caused the money to be transferred on May 9 from “the account of another company – NICON Investment Limited – into a new account that he (the second plaintiff) had opened in the name of the first plaintiff (Newswatch Communications Ltd) without any board resolution of the first plaintiff and in respect of which he was the sole signatory.”

    The pioneer directors admitted resigning as executive directors of the company at the completion meeting of May 5 last year. They said they were reappointed as non-executive directors, a development which accounted for why the magazine continued to bear their names as directors after the said meeting.

    They denied Ibriahim’s claim that an Annual General Meeting of the company was held on August 20 this year. “We state categorically that Form CAC 7 filed at the Corporate Affairs Commission as well as Form CAC 2 and Form CAC 2.1 attached to the plaintiffs’ affidavit are contrived by the second and third plaintiffs (Ibrahim and GMML) as there was no meeting of the first plaintiff (Newswatch) at all to that effect.

    The directors averred that rather than perform their obligations under the agreement, Ibrahim and GMML have allegedly hijacked the company to themselves, and seek to use the instrumentality of the court to legalise their alleged illegal actions.

    In their objection, they argued that the suit disclosed no reasonable cause of action against them, and that Ibrahim and his company do not have the authorization of the first plaintiff to sue.

    In their suit, Aruda and Aminu have also accused the company’s new management of systematically working to kill the its main publication – Newswatch weekly – magazine and replacing it with daily newspapers, to be published by a newly incorporated company – Newswatch Newspapers Limited – an arganisation in which Ibrahim’s company, GMML   owns a majority shareholding.

    They averred that Ibrahim as the new Chairman of Newswatch Communications Limited and the company “have not called a general meeting since the said new illegal take-over of the company.”

    They argued that despite that Ibrahim and his company, GMML failed to comply with the conditions contained in the agreement- a Share Purchase Agreement – of May 2011 between Newswatch and GMML, they “wrongly assumed” the management and control of the company and shut down its operations to the detriment and loss of other shareholders.

    Aruda and Aminu noted that by Clause 3.0 the 2011 agreement, Ibrahim and Global Mirror was to acquire 51 per cent stake in Newswatch Communications on the condition they pay N510million as purchase price; by Clause 4.0 the money was to be paid on or before May 5, 2011, and by Clause 13.0 Global Media was required to pay additional N500million within 90 days of its takeover of the company.

    “Without complying at all with any of the aforementioned conditions of the agreement, the second respondent (Global Media), through the instrumentality of the third respondent (Ibrahim), went ahead and took over full control and management of the first respondent (Newswatch Communications).

    They argued that since the company was shut in August last year, it has lost about N15.780million in revenue and profit, part of which ought to accrue to its shareholders, including the petitioners.

    Aruda and Aminu are praying the court to among others, nullify the May 2011 agreement; an order directing Ibrahim and Global Media to the N15.780m lost suffered by the company so far.

    They are also praying for an order directing that any verified money by Ibrahim and Global Media in Newswatch Communications be refunded to them by the receiver/manager from the funds realized from the operations of the company.

    They equally want the court to grant a perpetual injunction, restraining Ibrahim, Global Media and their agents from proceeding with the publication of the planned daily papers; and order of perpetual injunction restraining them from further interfering in the management and control of Newswatch Communications.

    They have also filed a motion on notice for interlocutory injunction restraining Newswatch Communications, Global Media, Ibrahim and Newswatch Newspapers from publishing and selling to the public, the daily newspapers pending the determination of substantive suit.

    In an earlier ruling on a motion ex-parte by Aruda and Aminu, Justice Ibrahim Buba, abridged the time within which the respondents were to file and serve their processes.

     

  • Newswatch: Ekpu, Agbese, others urge court to dismiss Ibrahim’s suit

    Newswatch: Ekpu, Agbese, others urge court to dismiss Ibrahim’s suit

    Four directors of the troubled news magazine, Newswatch, Ray Ekpu, Dan Agbese, Yakubu Mohammed and Soji Akinrinade – have asked a Federal High Court in Lagos to dismiss a suit by businessman Jimoh Ibrahim.

    They calimed the suit was without basis.

    The directors, who were in court yesterday contended that the suit showed no reasonable cause of action against them and that Ibrahim was not authorised by Newswatch to sue them.

    Their lawyer, Adekunle Oyesanya (SAN), said an alternate ground on which his clients opposed the suit was that it was wrongly instituted.

    He argued that the plaintiff ought not to have begun the suit via an originating summons because the issues raised are contentious and would require that parties call witnesses to resolve.

    Oyesanya observed that the originating summons showed that the plaintiff merely told a story of a business transaction between two parties, how the defendants purportedly resigned and how they entered into a contract over the company’s shares.

    He argued that as against what was required, the plaintiff failed to raise any complaint against the defendants.

    The counsel argued that the share purchase agreement between the parties did not preclude the defendants from declaring a trade dispute.

    Oyesanya said contrary to the plaintiff’s argument, the agreement contained a clause which allows a party to terminate the agreement.

    “There is no complaint in the affidavit that the defendants are trying to terminate the agreement.

    “That would have been an issue. But there is no such complaint.

    “Instead, they created an imaginary dispute outside the agreement by parties and rushed to the court.

    “In their claim, they have not made any complaint that is worthy of the court’s consideration,” he argued.

    Responding, the plaintiff’s lawyer, Adenrele Adegborioye, insisted that his clients’ suit was competent.

    He also faulted the defendants’ objection on grounds that it was faulty.

    Adegborioye argued that by failing to accompany their objection with an affidavit, the defendants’ objection should be struck out.

    “Where a party files an objection which raises issues of fact or mix law and fact, it must file an affidavit to support the preliminary objection, failure of which renders it incompetent,” he said.

    Adegborioye contended that the defendant’s objection dealt with issues of fact.

    He further argued that by contending that the suit showed no cause of action, the defendants have admitted their issues raised by the plaintiffs in the suit.

    He argued that the plaintiffs have raised enough issues in the suit to warrant the court’s intervention.

    In the suit filed by Ibrahim, his company, Global Media Mirror Limited and Newswatch Communications Ltd, the plaintiffs set six questions for the court’s determination and sought six declarative reliefs and an order.

    They prayed the court to, among others, restrain Ekpu, Agbese, Mohammed and Akinrinade from further acting as directors of Newswatch on grounds that they had allegedly resigned voluntarily from the positions.

    Justice Okon Abang adjourned till December 7 for them to further adopt their addresses to enable the court deliver its ruling within the stipulated three months.

     

  • Newswatch dispute: Ibrahim sues Ekpu, others

    Newswatch dispute: Ibrahim sues Ekpu, others

    •As court restrains them from acting as company’s directors

    A major investor in the troubled news magazine, Newswatch, Jimoh Ibrahim has sued four other directors of the organisation over the comapany’s management dispute.

    The directors named as defendants in the suit before a Federal High Court in Lagos include: Ray Ekpu, Dan Agbese, Yakubu Mohammed and Soji Akinrinade.

    Ibrahim is seeking to strip the other aggrieved directors of that status and prevent them from declaring a trade dispute between him,(with 51 per cent stake) and the remaining shareholders (with 49 per cent stake).

    He particularly prayed the court to restrain the defendants from acting on behalf of the other shareholders who own the remaining 49 per cent stake.

    He argued that the defendants, with just 6.3 per cent cumulative share holding, and having resigned from the company, could no act for the company or its other shareholders. The suit also has as plaintiffs, Ibrahim’s Global Media Mirror Limited and Newswatch Communications Ltd.

    In the substantive suit, the plaintiffs set six questions for the court’s determination and sought six declarative reliefs and an order.

    He prayed the court to among others decide whether the respondents, having resigned from the company on May 5 this year, could continue to act for the company and parade themselves as its directors.

    They also want the court to decide whether or not the respondents, with just 6.3 per cent equity, could act for the owners of the company’s 49 per cent stake; whether in view of their minority share holding, the respondents could also declare, in law, give notice of trade dispute with the company and its Chairman.

    Ibrahim urged the court to declare that the respondents, having resigned from the company, and their said resignation endorsed by the company’s board, they have ceased to by the company’s directors.

    He also want the court to declare that Ekpo and others having resigned from the company, can no longer be referred to as its employees.

    Ibrahim argued, in a supporting affidavit deposed to by Gloria Ukeje, that Newswatch owed about N362,132,764.19 when he bought into it and acquired 51 per cent majority shareholding.

    He said that by the current shareholding structure the defendants do not have enough shares for them to be qualified to be on the board.

    Meanwhile, the court presided over by Justice Okon Abang has temporarily restrained Ekpu and others from acting on behalf of the company, from decalring trade dispute; from making any form of publications in respect of the company and the Share Puchase Agreement by which Ibrahim bought into the company.

    The orders contained in a September 5 ruling on the plaintiffs’ application for interim injunctions, are to subsist pending the determination of the substantive suit.

    Hearing of the substantive suit has been fixed for October 15 before which the defendants are expected to have filed their response to issues raised.

     

  • Don’t let Newswatch die

    Don’t let Newswatch die

    The resting of Newswatch magazine by Mr Jimoh Ibrahim, its new owner, is tantamount to the killing of an important institution in Nigeria’s media industry. The entire process of its sale puts the magazine in the news, albeit for the wrong reason. Sadly, a medium that used to be the bastion of progressive news generation has now become a victim being feasted upon for news. It is difficult to fathom that the magazine is about becoming a relic.

    The facts surrounding the entire sale look more confusing than intriguing. It has been the words of Mr Ibrahim against those of Messrs Ray Ekpu, Dan Agbese, Yakubu Mohammed and Soji Akinrinade, all co-founders with the magazine’s assassinated pioneer editor-in-chief, Mr Dele Giwa. Ibrahim claimed the quartet got paid off when they retired from the board of directors and the company as a whole. He gave the breakdown of payments: Ekpu- N79 million; Agbese and Mohammed were paid N76 million each while Akinrinade was paid N68 million. Also, he alleged that they collectively have 6.1 per cent total shares which is less than the minimum legal demand of 10 per cent stake necessary before any shareholder can be considered for a board seat in any company.

    The quartet concurred to selling 51 percent stakes in Newswatch to Mr Ibrahim on May 2, 2011 but insisted that it was with an understanding that the paper and the principle behind its establishment on February 28, 1985 would be sustained. Barely 15 months of publication after the sale, the magazine is now in limbo. It is trite under the law that whoever owns majority shares in a company owns the company. Thence, it will be futile and naïve of minority shareholders to erroneously believe that they hold any strand of control over issues regarding the affairs of any company.

    However, the present hullabaloo should be seen beyond Newswatch; it ought not to be about legalism either; it should be about how to sustain a great institution and a brand that has made indelible imprints in the realm of defining what good governance should be, especially during the military era. It was in the course of pursuing this laudable goal that Giwa was killed on October 19, 1986. So, a veritable brand to which someone was martyred should not be destroyed under the guise of a wobbly business transaction.

    No doubt Newswatch lost touch with its credo at a time. The once vibrant magazine that made human rights statements as the epitome of its reporting, and one where written words became law had gone comatose as at the time Mr Ibrahim bought it.

    In spite of all these, what the magazine needs more now is not an undertaker but someone who would revive and possibly return it to its pride of place on the newsstands. This is why the promise made by Mr Ibrahim to revive it should be respected. To continue to insist on legalism in the entire transaction would further lead to undermining the mission and vision for setting up the magazine.

    Whatever the problems, we want Mr Ibrahim to know that there is no way the history of the tyrannical military era, albeit Nigeria will be written without a loud mention of Newswatch’s impressive role. How would it sound if Mr Ibrahim is recorded as the magazine’s undertaker?

    Mr Ibrahim should realise that for him to be part of history, he must ensure that the once popular Newswatch brand outgrows him. Any attempt to kill it will amount to killing a better part of the Nigerian media.