Ecobank launches suit to stop Barbican Capital, others from selling shares in FBN Holdings

Ecobank Nigeria Limited, the local subsidiary of Lomé-based Ecobank Transnational Incorporated, has initiated a legal action against Barbican Capital Limited, an affiliate of Honeywell Flour Mills.

The lender in a court paper dated 3 April 2025 sought an order of interim injunction from the Federal High Court Lagos, restraining Barbican and seven others from “taking any steps to amortize, dematerialize, compromise, sell, transfer or deal with the 6,314,116,229 collective aggregate shares” of Barbican in FBN Holdings (now First HoldCo) pending the hearing and determination of a motion on notice.

Honeywell Flour Mills, Siloam Global Services Limited, Otudeko Obafemi Adedamola (managing director of Honeywell Group Limited), Oyeleye Foluke, FBN Holdings Plc, Corporate Affairs Commission and the Nigerian Exchange are the 2nd, 3rd, 4th, 5th, 6th, 7th and 8th defendants respectively in the suit.

Ecobank Nigeria also sought an order preventing the defendants from attempting to turn into cash or any negotiable instrument Honeywell’s dematerialised shares, pledged to the plaintiff in relation to the credit facility granted to the company to purchase the disputed shares.

Dispute

Ecobank Nigeria granted Honeywell Flour Mills and Siloam Global Services a number of credit facilities including a loan of N2.5 billion and another in the sum of N2.3 billion on 20 April 2010 and 14 December 2011 respectively, according to court papers seen by PREMIUM TIMES.

Following the alleged failure of the two loan beneficiaries to complete the repayment of the loan as and when due, the duo together with their sister company Anchorage Leisures Limited approached Federal High Court Lagos to file a lawsuit contending that they were no longer indebted to Ecobank Nigeria.

Honeywell Flour Mills and Siloam Global Services claimed they had paid N3.5 billion out of a concession sum of N5.5 billion.

After eight years of legal warfare between the parties, the Supreme Court of Nigeria in 2023 dismissed the appeal by the companies in which they had claimed they were no longer indebted to Ecobank Nigeria.

“The debtor must pay all the debts that have accrued under the loan contract,” the Supreme Court ruled.

Going by the affidavit sworn in support of a motion on notice by Jafaru Kupa, a finance officer at Ecobank Nigeria, the debt of the appellants (Honeywell Flour Mills, Siloam Global Services and Anchorage Leisures) to the bank had soared past N16 billion as of 23 January 2023.

Ecobank Nigeria then requested immediate settlement of the debt in accordance with the ruling of the court.

In response, the three companies launched another lawsuit against Ecobank Nigeria at the Lagos court, claiming that the Supreme Court judgment did not mention the specific amount due to the bank.

“Prior to the commencement of the above-referenced judgment of the Supreme Court and suits in 2023, the 2nd defendant rather than await the decision of the Supreme Court divested a 71.69% stake (a majority stake) in its domain to one Flour Mills of Nigeria PLC on 29th April 2022 in a bid to overreach and frustrate all efforts of the plaintiff to recover its mammoth indebtedness,” the affidavit noted.

“In a further bid and a further brazen gait to annihilate the plaintiff’s legal rights, the alter egos of the 2nd and 3rd defendant some of whom are represented by the 4th and 5th defendants sometime on 9th March 2023 (after the judgment of the Supreme Court) incorporated the first defendant herein with the 7th defendant,” it added.

The court document further noted that Ecobank Nigeria was not aware of the purpose of incorporating Barbican until it became news that Barbican was a special purpose vehicle incorporated by its prime movers for the sole purpose of procuring a majority stake in FBN Holdings.

It also asserted that Barbican’s share acquisition in FBN Holdings was done by using the proceeds of the disposal of the 71.69 per cent stake in Honeywell Flour and the shares pledged by Siloam Global Services to Ecobank Nigeria as security for the credit facilities.

“I know of a fact that it is not in doubt that the debtor companies including the 2nd and 3rd defendants are indebted to the plaintiff in the sum of N20,890,183,433.00 (Twenty billion, eight hundred and ninety million, one hundred and eighty three thousand, four hundred and thirty three naira only), being their undisputed outstanding indebtedness to the plaintiff as at 20th March, 2025),” Mr Gupa said in the affidavit.

Ecobank Nigeria’s prayers

Ecobank Nigeria is seeking a declaration from the Lagos court that by virtue of the Supreme Court judgment, the funds used by Barbican, Honeywell Flour Mills, Ms Oyeleye and Mr Otudeko in purchasing the FBN Holdings shares sequel to the said judgment are the property of the plaintiff.

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It is also seeking an order of the court directing FBN Holdings and the Nigerian Exchange to rectify FBN Holdings register of shareholders to reflect Ecobank Nigeria as the substantive shareholders of the shares purchased in FBN Holdings by Barbican.

Ecobank Nigeria has asked the court to direct Honeywell Flour Mills to transfer to the lender the accumulated monetary value of the 618 million shares held by Siloam Global Services in Honeywell Flour Mills, which it pledged to Ecobank Nigeria as collateral for the facilities granted to the company.

Ecobank Nigeria is also requesting a perpetual order mandating FBN Holdings to recognise the former as the sole beneficiary of all the shares held directly or indirectly on behalf of Barbican and accordingly transfer the funds realised from the sale to Ecobank Nigeria in the cumulative sum of N20.9 billion.

The amount represents the outstanding indebtedness owed to Ecobank Nigeria in tandem with the judgment of the Supreme Court as at the 25th day of March 2025 and the interest thereon till the date of the final judgment in the suit.

Justice D.I Dipeolu, the presiding judge, adjourned the matter to 15 April for hearing the motion on notice.