United Bank for Africa Plc (UBA) has moved to join 86 Gardens Limited in a suit at the Federal High Court, Lagos, to safeguard its 21.54 per cent stake in a 60 per cent ownership interest in Ibadan Electricity Distribution Company (IBEDC).
The stake originates from a $162.4 million UBA’s facility to Integrated Energy Distribution Marketing Company Limited (IEDM) in 2013 for acquiring the IBEDC during the federal government’s privatisation programme midwifed by the Bureau of Public Enterprises (BPE).
The lawsuit, filed as FHC/L/CS/418/2025 by 86 Gardens Limited, targets Archlight Nigeria Limited, Abiodun Jamiu Owonikoko (SAN), and the Corporate Affairs Commission (CAC). Represented by Seni Adio (SAN), the plaintiff alleges violations of a Share Sales Agreement (SSA) and Tripartite Custody Agreement (CA), demanding 50 per cent equity in Archlight Nigeria Limited.
This claim hinges on Archlight being named the preferred bidder for IBEDC’s 60 per cent stake, sold by the Asset Management Corporation of Nigeria (AMCON). The plaintiff also seeks specific performance for share transfer registration and N100 million in damages.
UBA’s motion, filed under Order 9 Rule 24 of the Federal High Court (Civil Procedure) Rules 2019 and supported by an affidavit from staff member Afamefuna Ogbonna, underscores its role as a key lender in the $162.4 million Facility Agreement dated August 16, 2013. UBA’s 21.54 per cent stake in IEDM’s 60 per cent IBEDC ownership makes it a significant stakeholder. The bank seeks to join the suit to contest AMCON’s alleged unilateral sale of IBEDC’s 60 per cent stake, which UBA claims was executed without lender consent, at less than 20 per cent of the asset’s value, and in breach of the Facility Agreement.
The bank disputes AMCON’s authority to sell the entire asset, noting that the sale was not limited to Polaris Bank’s interest as the facility agent. The bank asserts it never sold its stake to AMCON and has launched a challenge to the sale via a statutory pre-action notice. UBA argues that its inclusion in the lawsuit is critical to prevent the court from validating an illegal sale, which could prejudice its secured interest if Archlight is recognised as the preferred bidder.
During the May 16, 2025, hearing, Seni Adio (SAN) represented the plaintiff, Babatunde Kwame Ogala (SAN) appeared for Archlight, Victor Okpara (SAN) for Owonikoko, and Temilolu Adamolekun for UBA. The plaintiff noted CAC’s absence despite being served and questioned the relevance of UBA’s interest, suggesting the “preferred bidder” issue was resolved. Ogala confirmed filing responses, including to UBA’s motion, while Okpara submitted a conditional appearance and counter-affidavits. Adamolekun stressed the priority of UBA’s joinder application, refuting claims that UBA sold its interest to AMCON. As discussions on application priority began, Justice Musa Kakaki adjourned the case to July 16, 2025.
UBA’s fight to protect its 21.54 per cent stake highlights its resolve to uphold its financial interests amid allegations of AMCON’s overreach. The bank’s challenge raises critical questions about lender rights and the legitimacy of AMCON’s asset sale process. The court’s decision could impact UBA’s stake and set a precedent for handling distressed asset sales in Nigeria.
(Inside Business Online)
