The stock fell 26 percent to 110 pence at the close in London, the lowest price since July 2012. Trading volumes were 20 times the three-month average.
Afren temporarily suspended Chief Executive Officer Osman Shahenshah and Chief Operating Officer Shahid Ullah after an investigation found they may have benefited from unauthorized payments, the company said in a statement today. The board has notified relevant regulatory authorities that a review is taking place, it said.
The investigation, prompted by the potential need for disclosure of “certain previous transactions” to the market, is being conducted by law firm Willkie Farr & Gallagher LLP.
“Corporate governance at the company has always been controversial,” Jamal Orazbayeva, an analyst at Westhouse Securities Ltd., said by phone from London. “The market needs more clarification to find out what’s happened.”
The payments weren’t made by the company and the probe didn’t find evidence that other board members were involved, the explorer said.
Egbert Imomoh will become executive chairman, and the board appointed Toby Hayward, currently senior independent director, as interim CEO while the investigation continues.
Half-year earnings, scheduled for Aug. 4, have been postponed with a new date to be announced by the end of August.
The explorer operates in parts of Africa including Congo, Kenya and South Africa, according to its website. The bulk of its business is in Nigeria, where it is involved in seven blocks.
To contact the reporter on this story: Nidaa Bakhsh in London at email@example.com