NICON: Ibrahim's American Wonder

Group Head of the National Insurance Corporation of Nigeria (NICON), ‘mystery investor', Jimoh Ibrahim, faces a big hurdle as a Federal High Court places a caveat on the corporation's assets

By George Umunnakwe

When in the last quarter of 2005, a consortium known as the Assurance Acquisition Limited (AAL) was conceived, its members looked forward to a successful relationship of likeminds who had come together to achieve a common goal.

Notedly, when the idea for the acquisition of the National Insurance Corporation of Nigeria (NICON) was mooted by a member, the others gave a nod to the plan. This was followed by the payment of a 10 per cent and 90 per cent bid price for the take-over of blue chip Nigeria Insurance Company (NICON), which was made on October 28, and December 1, 2005 to the Bureau for Public Enterprises (BPE).

Addressing newsmen immediately after taking over the firm on February 20, 2006, business mogul, Jimoh Ibrahim, whose company Global Fleet Oil and Gas, alongside Oceanic Bank Plc, Great Nigeria Insurance Plc., and Engery Destination, own majority share in the consortium, named himself the new Chief Executive Officer (CEO) of the corporation. This move, however, did not go down well with some board members who questioned the rationale behind the decision. They were notably not the only ones that condemned the decision, as the National Insurance Commission (NAICOM), leading Insurance stakeholders posit that Ibrahim is not qualified to hold such a position. They argued that the chairman of Global Fleet Oil and Gas does not have the requisite professional backing to lead an insurance company.

While denouncing the move, Afribank Nigeria Plc, Nigeria Social Insurance Trust Fund, Kapital Insurance Limited, APT Securities and Funds Limited, and N-Glory Development, who are all co-partners in the AAL consortium vowed not to rest until Ibrahim steps down as the CEO of NICON. They, through their counsel, Dickson Osuala, told a Federal High Court sitting in Abuja that Global Fleet Oil and Gas Nigeria Limited, owned by Ibrahim has not acquired any interest in NICON Insurance Plc and so cannot lay claim to its ownership.

Osuala stated that Global Fleet Oil and Gas will be deluding itself if it claimed ownership of NICON, arguing that the name Jimoh Ibrahim does not exist as far as AAL's ownership of NICON is concerned.

Global Fleet had at a board meeting held on October 27, 2005 reasoned that since it held a lion portion of NICON shares, alongside Oceanic Bank Plc, Great Nigeria Insurance Plc and Engery Desination, it had the powers to appoint Ibrahim as CEO of the newly acquired insurance firm.

But in faulting this claim, Osuala explained that the purported board meeting at which a representative of Global Fleet was appointed as a member of AAL's board was illegal. He said that the resolutions adopted at the said board meeting were null and void because two directors who were part of the company's board had resigned. The legal practitioner was referring to the resignation of Mrs Abosede Fagbola, a representative of the oil firm at AAL and another official representing Al-Glory Development. “Therefore, any resolution adopted at the end of the said meeting was null and void because the two directors who constituted the company's board had resigned,” Osuala argued.

Ostensibly coming to the aid of the embattled Group Head of NICON, the Federal Government through the Attorney-General of the federation and Minister of Justice, Chief Bayo Ojo, in a letter dated May 12, 2006 and addressed to Ibrahim, said there is no law in Nigeria that prevents him from presiding over the affairs of the NICON Group. This move by the government rubbished the resolve of NAICOM, the insurance regulatory authority, not to allow a non-professional run any outfit in the sector.

However, it may not be yet uhuru for the business mogul, as a Federal High court sitting in Abuja on Wedensday, June 28, 2006 placed a caveat emptor on all NICON assets. The court presided over by Justice Stephen Adah in placing the warning said there are allegations that the management of the company was busy selling off its assets. Justice Adah further declared that anybody that invests his money in such assets does so at his own risk.

His words: “We all know the rules, we know how assets wrongly bought are recovered, anyone who goes to buy assets of a company whose ownership is in controversy does so at his own peril.”

Osuala, counsel representing the parties contesting the ownership of NICON with Ibrahim had at the resumed hearing told the court that the defendant (Ibrahim) was selling properties of NICON and generally wasting the assets. This was contained in one of the affidavits filed before the court by the plaintiff's counsel.

Osuala specifically referred to three landed properties located in London which he alleged Ibrahim recovered the title deeds with intent to sell them. “The properties worth over three billion naira were said to be respectively located at 10 Billion Parke Road, Barnes; 43 Melbury Road Kessington and 21 Worship Street, EC2, all in London,” the affidavit stated.

The business mogul was also alleged to have moved the sum of $15 million from NICON's foreign account in the United Kingdom to his private account overseas.

However, when The Source called the corporation's offices in Abuja, a very reliable source explained that though monies were withdrawn, the said amount, according to the official, were used to settle claims which arose from the Sosoliso aircraft crash of December 2005, paying off retrenched workers, payment of pensions, and acquisition of new companies. “Where do you think all the monies used in actualising these came from? When Oga bought over NICON, the corporation had nothing and was neck- deep in debt. We had to settle all the debts before making in-roads into investment and repositioning the corporation,” the source hinted.

Ibrahim may have tacitly confirmed this, when on Monday, July 3, 2006, he told newsmen that the group entertained a lot of claims in the first quarter of 2006, which included the payment of N150million to Sosoliso Airlines. Ibrahim: “I emphasised that the aircraft was not reinsured, neither was it co-insured and the premium paid on the aircraft was about N1.5million and the claim was N150million.”

Meanwhile, the disagreement on June 28, 2006 took a new twist, as the counsel to AAL dragged the Bureau for Public Enterprises (BPE), the Registrar General of the Corporate Affairs Commission (CAC) and Northbridge Investment and Trust Limited into the suit.

The application was filed on Monday, June 26, 2006 and served to the new defendants on Tuesday, June 27, 2006 ahead the June 28 adjourned date by AAL counsel, Osuala.

AAL claimed the Memorandum of Understanding (MOU) which was presented to the BPE before the handover was not duly signed by members of the consortium. This is contrary to a claim by NICON's management that an MOU was signed before the take-over of the company.

According to Osuala, “AAL did not sign that MOU, and none at Niger Insurance, APT Securities, Kapital Insurance, New Era Consortium and N-Glory Development.”

The counsel to AAL further claimed that the BPE had acknowledged the irregularities in the MOU and had requested that necessary steps be taken to get all signatories to sign it (MOU). This, the Bureau explained in a letter dated November 7, 2005 and signed by the Director, Commercialisation and Transaction Support, Mrs Modupe Abiodun-Wright.

Arguing on behalf of the Group Head of NICON, B.J. Akomolafe of Afe Babalola Chambers, told the court that AAL had not authorised Osuala to file the suit on its behalf. Arguing an application to this effect, Akomolafe tendered a letter by a director in AAL, Charles Kadiallah, denying giving any instruction to Osuala to institute the action.

But describing the letter as laughable, the counsel to AAL contended that the position was misconceived because the director in question had since resigned his appointment as a director of the company. Osuala butressed his point by tendering the letter of resignation.

Justice Adah reserved ruling on the application and adjourned the case to September 28, 2006, for further hearing.