Court orders Amcon to pay Capital Oil N26.5b

The Federal High Court, Abuja, on Thursday ordered the Asset Management Corporation of Nigeria (AMCON) to pay Capital Oil and Gas Industry Limited N26.5 billion as contained in a consent judgment delivered in 2013.

Sixty two year-old Justice Abdul Kafarati, in his judgment, held that the court has powers to enforce its judgment or that of any lower courts in the country.

“An order is granted for AMCON to provide Trade Finance Facility in the sum of N16 billion for revamping of the plaintiff’s business and to pay the plaintiff’s trade creditors.

“I also grant an order compelling the defendant to comply with the consent judgment and to make the additional sum of N10.5 billion available to the plaintiff.

“This money is the payment of sundry creditors who continue to threaten the plaintiff’s business.,” Kafarati held.

Kafarati also restrained AMCON from exercising any powers over Capital Oil and Gas Limited and its assets.

These,according to him, include attempts at processing any assignment or transferring same on behalf of the company.

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A Federal High Court in Lagos on May 6 struck out the suit brought by AMCON against Capital Oil and Gas Industries Limited on these issues.

The court held that the suit was premature and could circumvent pending suits relating to the alleged indebtedness of Capital Oil and Gas Limited.

The plaintiff (Capital Oil and Gas Industry Limited) had approached the court to decide whether having regards to the consent judgment, AMCON was not under obligation to restructure its debt.

The plaintiff also asked the court to decide whether the actions of the defendant and agreements reached by parties since the consent judgment did not constitute a waiver of the requirement for compliance.

The court was also asked to decide whether the defendant was not wrong to have failed to restructure the plaintiff’s debt.

The plaintiff further sought the determination of the court whether if the defendant did not by its action fail to avail it trade facility in the sum of N16 billion to pay its trade creditor.

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Reacting to the judgment, Mr Ajibola Oluyede, counsel to the plaintiff, described it as a landmark decision.

He,therefore, urged the defendant to accept the judgment, adding that such step would encourage growth of private businesses in the country.

In 2013, AMCON took over the company, following its over N100billion indebtedness to the Nigerian banks.

AMCON which was established  to help stabilize and revitalize the Nigerian banking system and economy acquired Capital Oil and Gas’s (COG) outstanding facilities from various banks.

Following discussions with COG, a resolution was reached which was subsequently adopted as terms of settlement in suit number FHC/ABJ/CS/714/2012 at the Federal High Court.

One of the key conditions of this settlement was that AMCON should take over executive management of COG for a period of two years.

Ifeanyi Ubah, the erstwhile Managing Director/Chief Executive Officer  consequently relinquished his role as head of the organization.

AMCON  appointed an acting Managing Director to ensure accountability and continuity of operations.

This change of management was effected on June 21, 2013