The story of ELANO Investments Limited
By Samuel O. Onungwe
The civilian government of President Olusegun Obasanjo in 2004 indicated willingness to privatise some public enterprises following the failure of many of them due to poor management. The Technical Committee on Privatisation and Commercialisation TCPC had been constituted as far back as 1988. This committee metamorphosed to the Bureau of Public Enterprise, BPE in 1993, with a supervisory technical board as BPE retained the organisational structure and personnel of the TCPC. It was then recreated in 1999 as an independent body without a board and to report only to the National Council on Privatisation and headed by the Vice President of the federal republic of Nigeria. The secretary of the NCP also serves as the Director General of the BPE. The NCP and BPE have the mandate to oversee the proper and effective implementation of privatisation or commercialization of public assets and one of which was the Eleme Petrochemicals Company Limited, EPCL which was hitherto, moribund. This intention of the government prompted Eleme leaders to put up a memo to the BPE in 2004. In that memo, they recalled that their land was acquired for public interest in which case, compensation were only paid for food crops, cash crops, economic trees and improvement done on the land as at the time it was being acquired in line with the land use act and termed adequate compensation. The host communities then argued that since it was acquired for public interest and it was being changed to private investors, they should be awarded 20% shares in the newly planned EPCL as a show of appreciation for sacrificing their land. Some of the signatories to the letter include: Prof. W. G. Ollor, Ɛmԑrԑ Gomba Okanje, HRH Ɛmԑrԑ (Dr.) Philip O. Obele.
There was no reply from the BPE until 2009 when it was announced on media that the Indorama group from Indonesia had acquired controlling shares in the company believed to be about 57%. Dangote group had bided for the asset, among others but Indorama emerged winner. This transfer of ownership suffered resistance from the NNPC workers who were the staff of the EPCL for it was until then, a subsidiary of the NNPC. The BPE valued each share for 7,800 naira and that exactly what Indorama group paid for each share.
Having paid for the asset, it was difficult for Indorama to take possession of the asset it had acquired due to the resistance of the EPCL workers and the host communities whose stakes were not considered in the process. The NNPC and BPE held up to 25% shares between 2006 and 2009 until President Umaru Musa Yar’ Adua came on board and the Vice President Goodluck Jonathan was appointed the chairman, National Council on Privatisation, NCP which was formerly held by Vice President Atiku Abubakar. To pacify the host communities and the workers, the NCP approved 7.5% and 2.5% shares to be offered to the two groups respectively. This action would give a sense of belonging to the two vested interests and gain their confidence for the privatization programme of the federal government. To that effect, offer letter dated 20th April 2009 and signed by Dr. Christopher U. Anyanwu, Director-General, BPE was dispatched to the Ͻnԑ Ɛԑ Eleme, HRM Ɛmԑrԑ (Dr.) Samuel Oluka Ejire through the Eleme Local Government Chairman, Hon. Oji N. Ngofa and reads as follows:
We wish to formally inform you that the NCP has approved the sale of 7.5% shares of the EPCL amounting to 375, 000 units to the seven host communities of the company at the core investor acquisition price of 7,800 naira only per ordinary share of 50 kobo each. In granting the approval, the Council took cognizance of the exemplary cooperation and good relationship between the host communities and the core investors, hence the concessionary offer price of 7,800 naira per share as against the current value of 15, 040. 00 per share.
Please note that in order to ensure equity and fairness to all host communities and in line with our proposal during the stakeholders’ meeting of 16th April 2009, the shares shall be allotted based on each community’s land acreage in EPCL as follows:
Table 1: Offered shares per host community with respect to their land contribution.
|S/N||Community||Land Hectarge||Land %||No. of Shares||Rate Per Share (||Amount Payable|
|1.||Akpajo||320||35.0||132, 890||7,800.00||1, 036, 542, 000.00|
|2.||Njuru||143||16.0||59, 386||7,800.00||463, 210, 800.00|
|3.||Akpankpan||143||16.0||59, 386||7,800.00||463, 210, 800.00|
|4.||Okerewa||188||21.0||78, 073||7,800.00||608, 969, 400.00|
|5.||Aleto||78||8.5||32, 392||7,800.00||252, 657, 600.00|
|6.||Agbonchia||27||3.0||11, 213||7,800.00||87, 461, 400.00|
|7.||Wakaohu family||4||0.5||1, 661||7,800.00||12, 955, 800.00|
|Total||903||100||375, 000||2, 925, 000, 000.00|
For three years, the host communities had received the letter but could not raise the requisite 2.925 billion naira needed for the purchase of the offered shares. Soon the offer was to be withdrawn, at this time, the EPCL staff had used an arrangement involving their salaries and other emoluments as collateral to obtained a needed sum from the Stanbic IBTC to purchase their and were enjoying the benefits of the shares acquisition. The success of the workers spurred some Eleme contractors with the company to view the scheme with a business perspective. These contractors include: Hon. Onorwi Ngofa, Ɛmԑrԑ Gomba Okanje, Hon. Fineman Olungwe among others constituted ELANO Investments. The word ELANO itself is an acronym coined from the names of the seven communities that make up the Indorama EPCL host community. After deliberations and strategizing, the founding members of ELANO I. L. met the host communities to authorise them to source for funds, buy and manage the shares on behalf of the host communities. Thorough negotiations were made with the representatives of the communities; an agreement with terms and conditions well spelt out and signed to that effect on Monday, 27th October 2011, being the Memorandum of Understanding MOU. However, the host communities had the perception that the shares were given in lieu of their land against the actual thing being an offered. Therefore, a technical committee was setup by the host communities with two persons each from each of the host communities. That technical committee which was a 13 man committee was chaired by Hon. Onorwi Ngofa who in turn, appointed Barr. Fred Mbombo Igwe to serve as an Adviser while some other members of the committee include: Sir Obianko Nwolu Elechi, Prof. W. G. Ollor, Hon. Fineman Olungwe and others. Their term of reference was to interface with the BPE on how to take collect the shares but of course, the process was futile. The Director General of the BPE then was Irene Chigbue (2005-2009). They left the BPE disappointed on 9th November 2009 and there was no hope of acquiring the shares in 2009, 2010 and 2011. At this time, ELANO Investments was incorporated and with their certificate of incorporation, they again, approached the communities, dialogued with them and secured an agreement with the traditional rulers of the communities on behalf of their people on 27th October 2011, being a Monday. This MOU was signed and a letter of introduction was written by the Ͻnԑ Ɛԑ Eleme X (the Ruler of Eleme), HRM Ɛmԑrԑ (Dr.) S. O. Ejire to the Stanbic IBTC after a thorough search for any willing person or bank that would be willing to offer a loan for the shares. The Stanbic IBTC then agreed to offer the a loan of the needed sum to ELANO Investments Limited (ELANO I.L.) to enable it purchase the shares and manage them on behalf of the host communities with respect to the terms and conditions in the MOU it had with ELANO I. L.
Following the request by ELANO I. L. in 2011 to the BPE and with an introductory letter from Ͻnԑ Ɛԑ Eleme X, HRM Ɛmԑrԑ (Dr.) S. O. Ejire to the DG BPE to make their account details available for the needed sum to be paid in order to take possession of the equity on behalf of the host communities, the BPE in 2012 wrote to the Rivers State Government of Rt. Hon. Chibuike Rotimi Amaechi to identify ELANO I. L. for the said purpose. The Governor then, wrote to the Secretary to the State Government, SSG Mr. George Faeii to convene a meeting on 6th March 2012 with the host communities and ELANO I. L. to be sure both parties have agreed to the terms. At the meeting some concerns or objections were made. Notable among them was that of Prof. W. G. Ollor his opposition was hinged on his argument that he was a major stakeholder and he ought to have been incorporated into the ELANO I. L. Next was that of 38 families of Agbonchia who claimed that they were the actual owners of the land and not Agbonchia. A break away community from Njuru, Akpankpan also, criticized the constitution of ELANO I. L. without any of their own representatives. To address these valid concerns, it was resolved that ELANO I. L. should make some amendments and accommodate the mentioned stakeholders. For these reasons, two persons from Akpankpan community are to be incorporated as their representatives and these were Ɛmԑrԑ Osaro Amasi Nwafor and Ɛmԑrԑ Abel Ejie Olongwe, Prof. W. G. Ollor for the issue he raised and Ɛmԑrԑ Ngei Agba would represent the 38 families at Agbonchia. The meeting of 6th March 2012 then mandated them to return home and hold a wider consultation and report back to the SSG and this should not be more than 30 days. On the 9th March 2012 a meeting of stakeholders was held as directed by the SSG and chaired by the Executive Local Government Chairman, Hon. Oji N. Ngofa the outcome of the meeting was a letter addressed to the Secretary, Rivers State Government, Government House with a ref: ELEGA/EC/VOL.2/72 and dated 9th March 2012.
Sequel to the meeting of EPCL host communities stakeholders held in your office on 6th March 2012. The representatives/Trustees met at the Palace of HRM Ɛmԑrԑ S. O. Ejire on the 9th March 2012 and agreed to resolve their differences. Please see the enclosed detail of the resolutions at the meeting.
The letter was signed by Hon. Oji N. Ngofa, the Executive Chairman Eleme Local Government Council and the resolution (MOU) reached was as follows:
- That ELANO I. L. should be the (SPV) special purpose vehicle for the acquisition of 7.5% equity shares in the privatized EPCL
- That ELANO I. L. has been structured to reflect the interest of all the parties.
- That the following persons were added as directors of ELANO I. L.:
Akpajo (i) Prof. Walter G. Ollor
Agbonchia (i) Mr. James Ngei Agba
Akpankpan (i.) Ɛmԑrԑ Osaro Amasi Nwafor
(ii.) Ɛmԑrԑ Ejie Olongwe
- That BPE should make available their bank details to ELANO I. L. for immediate payment for the 7.5% equity shares in the privatized EPCL.
- That the secretary of ELANO I. L. should file documents to effect the changes at the CAC immediately.
The document was signed for and on behalf of the representative/trustee per attendance list attached which had the names, phone numbers, community and signatures of Gomba Okanje, Godwin Risi, James Ngei Agba, Awalanta Ejire, Ejii Anyaogu, Walter G. Ollor, Nwokolu Dimkpa Nte, Ejie Olongwe, Onorwi Ngofa, Fineman Olungwe, Ngokanya Benjamin N, Mike Wodi among others and closed with the following authorities:
- Hon. Oji N. Ngofa – Executive Chairman, Eleme LGA
- Hon. Josiah J. Olu – Member, Rivers State House of Assembly
- Hon. Fred Igwe – Commissioner for Sports, Rivers State
- HRM Ɛmԑrԑ (Dr.) S. O. Ejire – Ͻnԑ Ɛԑ Eleme (The Ruler of Eleme)
ELANO I. L. having satisfied the conditions stipulated by the offer letter, the BPE transferred 375, 000 units of shares of 7,800 naira each to the ELANO I. L. in their Standard Chartered Bank account. The Stanbic IBTC bank which was issuer of the loan and through a consensus with ELANO Investments Limited, appointed the Stanbic IBTC Trustees to manage the shares for five years to enable ELANO I. L. pay back the loan to Stanbic IBTC bank. It was to last for three years but in about a year, the dividends accruing to the shares were enough to clear up the debt. Business Day Newspaper of 2nd April 2021 states this about ELANO I. L.:
Having secured a loan of
N 3 billion to acquire the shares, ELANO later took possession of the accumulated N 14 billion dividends and shared it out with the various sections of the community according to the memorandum of understanding. The arrival of such a sum seemed to spark off the fire as many of the leaders who seemed uninterested in the shares when funds were being mobilised took a new stand against ELANO, saying they had no right to manage the equity.
Hence, as at 23rd July 2012, ELANO I. L. had paid off the debt with the bank. Otherwise, the MOU between the bank and ELANO I. L. was that 80% of the dividends would be used to service the loan, 10% to be shared between ELANO I. L. and host communities and another 10% would serve as a reserve for the debt servicing in case the Indorama EPCL records a deficit. The success recorded by ELANO I. L. attracted the interest of many who had been indifferent about the acquisition of the shares from the beginning hence, the fight to control the body has moved from the streets to the court at different times.
The MOU ELANO I. L. has with the host communities among other things states that:
- ELANO I. L. shall source for and provide all the funds, expertise and logistics required for the acquisition of the 7.5% shares.
- ELANO I. L. shall receive and manage all dividends in a professional and ethical manner on behalf of, and for the benefit of the host communities.
- ELANO I. L. shall facilitate the opening of individual communities’ accounts for the receipt of dividend payout.
- ELANO I. L. acknowledges the current litigation between Aleto and Akpajo communities as it relates to the EPCL shares, and shall take steps to secure the dividends due to both communities pending the outcome of the case in court or settlement.
- ELANO I. L. shall be entitled to not more than 8% of the annual turnover as management fee.
- That this is the desire and intention of both parties that they be firmly bound by the terms, objectives, stipulations and conditions herein stated.
- This MOU shall be binding and enforceable against the parties hereto or those being represented and shall have the force of a contract.
Contrary to the claims that the signatories to the documents signed as individuals and not on behalf of their people/communities, the document was actually signed by:
1. Ͻnԑ Ɛԑ Eleme/ Agbonchia HRM Ɛmԑrԑ (Dr.) S. O. Ejire
2. Ͻnԑ Ɛԑ Nchia/Aleto HRH Ɛmԑrԑ (Dr.) Philip O. Obele
3. Ͻnԑ Ɛԑ Alu Okerewa Ɛmԑrԑ Osilaechu Ngbigbii
4. Ͻnԑ Ɛԑ Alu Njuru Ɛmԑrԑ Isaac Obele Eeh
5. Ͻnԑ Ɛԑ Ɛta Akpajo HRH Ɛmԑrԑ Fredrick Nwidaa
6. Ͻnԑ Ɛԑ Alu Akpankpan Ɛmԑrԑ Osaro Amasi Nwafor
7. Chief Dairus Risi Wakohu family of Elelenwo
8. Chairman, ELANO I. L. Ɛmԑrԑ Gomba Okanje
9. Secretary, ELANO Investments Limited Hon. Godwin Risi
Similarly, ELANO I. L. and the host communities at an all inconclusive stakeholders meeting held in the Palace of HRM Sir (Dr.) S. O. Ejire JP, Ͻnԑ Ɛԑ Eleme X and at the instance of the Caretaker Committee Chairman of Eleme LGA, Hon. Johnson O. Nwogu and the traditional rulers of the host communities on 21st January 2016 at Agbonchia agreed that;
- That henceforth 30% for direct community disbursement is raised to 45% and proper accounts are kept.
- That hitherto, the community development fund of 40% should be reduced to 25%.
- That 22% be kept in the Trust Reserve Account and 8% for administrative cost.
- That ELANO I. L. should forthwith at various community levels improve on the communication between them and the host communities.
- That project shall be identified and implemented by individual host communities under the supervision of ELANO Investments Limited.
- That all ongoing projects and yet to be started project be allowed to be completed without any impediments.
- That following this agreement, all hostile activities and protest should cease forthwith.
Despite agreeing to the stated conditions and signed, some members of Indorama EPCL host communities took to violence, burning houses, and attempts to mob the directors of ELANO I. L. until the Rivers State Government intervened to arrest the situation and restore peace as he persuaded the aggrieved parties to seek judicial resolution. ELANO I. L. then proceeded to the court seeking judicial interpretation of the rights and agreement they had secured with the host communities through their representatives.
Justice Hillary Oshomah in April 2017 then granted the prayers made by ELANO I. L. upon studying the claims of the complainant and counter claims by the 28 defendants. In the ruling, the court recognised the agreement between ELANO I. L. and the host communities which stipulated how the dividends would be shared including the fraction for developmental purposes. The court then granted an order of injunction which restrains the defendants from interfering or obstructing ELANO I. L. from acting as legitimate manager of the Indorama EPCL host community equity.
The defendants were dissatisfied and then proceeded to appeal but also lost in that quest. Again, in 2020, one of the aggrieved parties got an injunction from the high court to stop Indorama EPCL from releasing the dividends to ELANO I. L. but the latter went on to appeal. The Court Appeal then granted the motion filed by ELANO I. L. for a stay of execution of the orders of a Rivers State High Court presided over by Justice A. Enebeli which restrains Indorama EPCL from remitting dividends to ELANO Investments Limited.
The court described as strange the lower court’s decision to suo-moto (on its own) extend exparte injunctions on 9th November 2020 without hearing the parties, whereas the same court had adjourned the same case to 10th November 2020. The 3-member panel of the Court of Appeal unanimously dismissed the counter affidavit filed by Hon. Aforji Igwe opposing ELANO Investments Limited’s motion of stay of execution. The court found that the counter affidavit contained falsehood and accordingly, dismissed it.
By this judgement ELANO I. L. is empowered to pay the host communities the dividends of their shares in Indorama EPCL which were put on hold by a court order obtained by Hon. Aforji Igwe in October 2020 as well as resume ongoing community development projects which also suffered a setback from the order.
Although, a community newspaper had quoted Hon. Aforji Igwe to have approached the Supreme Court of the land, the implementation of the Appeal Court judgement has commenced as Hon. Onorwi Ngofa, a director of ELANO I. L. had announced that ELANO participated in the last Annual General Meeting, AGM of Indorama EPCL with other stakeholders where the recent dividends of the company were announced on 6th April 2021.
ELANO I. L. has always kept to the terms of this contract with the host communities and therefore it becomes rather difficult to force back a delivered child into her mother’s womb and that may be the reason why despite the campaigns against ELANO I. L. it remains firm. Having transferred the requisite dividends to host communities, it is not the business of ELANO I. L. how a host community decides to spend their money, although it is a known fact that each community has a local management team appointed by stakeholders for the disbursement of the received funds to benefiting individuals. On project, the MOU defines how it should be conceived, pursued and executed. Akpajo had been declared by the West African Court of Appeal in 1944 as a customary tenant to Aleto and therefore until a court of competent jurisdiction decides the matter the total benefits other host communities enjoy may continue to elude them. Aleto has always been willing to settle out of court with Akpajo; however, Akpajo would rather let the court decide.