Ecobank Says No Plans to Sell Airtel Shares at a Loss
(Corrects to say board previously agreed to appoint independent advisers in 10th paragraph.)
Ecobank Transnational Inc. (ETI) said it had no intention of selling shares of Bharti Airtel Ltd. (BHARTI)’s Nigerian unit at a loss after reports FBN Holdings Plc (FBNH) Chairman Oba Otudeko sought to purchase them at a discount.
Otudeko, an Ecobank shareholder and chairman of Nigeria’s third-largest lender by market value, requested a price of $88 million to buy 16 million shares of Airtel Nigeria, a mobile phone operator acquired by the Lome, Togo-based bank in 2011 at $101 million, the Financial Times reported yesterday, citing unidentified people. Ecobank rejected the deal, the FT said.
“We do not wish to sell these assets at a loss, and no such deal has been agreed,” Jeremy Reynolds, a spokesman for Ecobank, said in an e-mail today.
Otudeko wasn’t available to comment, his secretary at Lagos-based Honeywell Group, where he is chairman, said when contacted by Bloomberg.
The report comes after Ecobank’s executive director of risk and finance, Laurence do Rego, told Nigeria’s Securities and Exchange Commission last month that Chief Executive Officer Thierry Tanoh and Chairman Kolapo Lawson planned to sell non-core assets below market value. Do Rego also said she had been pressured to write off debts owed by a business headed by Lawson and manipulate the bank’s results in 2012.
“She has made these allegations, and these are without foundation,” said Reynolds. Do Rego declined two invitations to substantiate her allegations to Ecobank’s board, he said. Do Rego, who is on leave, doesn’t have contact details listed on the bank’s website and couldn’t be reached for comment.
Honeywell Group, which invests in energy, engineering, goods and real estate, also urged Ecobank to approve a $12.5 million writedown of its debt to the bank, the FT reported, citing correspondence it says it has seen.
Otudeko declined to comment on details, saying his business relationship his companies have with Ecobank is at arm’s length, according to the FT.
“We can’t comment on an individual customer’s confidential business,” Reynolds said. “The way in which Ecobank Nigeria manages this transaction is absolutely consistent with that of any other customer, and any changes to terms of a loan would have to go through its own approval processes. Ecobank Nigeria has its own board.”
Ecobank’s board will meet today and had previously agreed to appoint independent advisers to assist with a review of the lender’s corporate governance, Reynolds said. Obi Adindu, a spokesman for Nigeria’s SEC, which is investigating the lender’s corporate governance, declined to comment in an e-mail today.
Founded in 1985, Ecobank operates in France and 34 African countries, more than any other lender. It has representative offices in Beijing, Dubai, Johannesburg, London and Luanda, Angola. The bank had $21 billion in assets at the end of June.
Ecobank’s shares fell for a fifth day, down 1.8 percent to 13.25 naira at 1:27 p.m. in Lagos, the commercial capital.
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