JUSTICE John Tsoho of the
Federal High Court, Lagos, has
ordered Stanbic IBTC Bank to pay
N4.5 billion to a former Group
Managing Director of Afribank
Nigeria Plc, Patrick Olayele
Akinkuotu, and his company,
Longterm Global Capital Limited
for breach of contract.
The judge also ordered Stanbic
IBTC and the second respondent
in the suit, Starcomms Plc, to pay
interest of 10 percent on the sum
per annum until the date of final
The court also ordered that the
100 million units of Starcomms’
share sold to the plaintiffs through
private placement in 2008 were
improper, invalid, null and void
and were hereby set aside.
Akinkuotu and his company
had dragged the bank and
Starcomms before the court in
2012, alleging that Stanbic IBTC
deliberately misled them into
buying shares of the second
respondent by misrepresenting
facts and issuing false documents.
Other plaintiffs in the suit are:
Mrs. Oluyinka Akinkuotu and
Lakeside Mews Limited.
According to the suit, which
was filed by the plaintiffs’ lawyer,
Chief Felix Fagbohungbe, SAN,
in April, 2008, the plaintiffs
claimed that the bank through
one of its officers, Akintayo
Mabeweji proposed to sell shares
of Starcomms to the plaintiffs by the bank gave the plaintiffs an
Investment Letter dated April 24,
2008, bearing the names of Stanbic
IBTC and another company,
Chapel Hill Advisory Partners
Limited as Joint Issuing Houses.
The Investment Letter and
Form of Commitment were
represented by the bank as the
only placement documents which
target or prospective investors
were expected to rely on before
they made their unfettered
independent investment decisions
in respect of the placement.
That based on these, each of
the plaintiffs were committed
to purchase 25, 000, 000 units of
Starcomms shares and promptly
complied with the instructions of
the bank.
That on July 24, 2012 the
plaintiffs received two separate
investigation letters from
the Securities and Exchange
Commission, SEC, which raised
several issues in respect of the
private placement and upon
enquiry the plaintiffs discovered
that the authentic and final
document prepared and submitted
to SEC by the defendants was a
Private Placement Memorandum
dated May 5, 2008 and not the one
given to them.
The plaintiffs also averred
that they were misled by the
representation which was
deliberately made by Stanbic
IBTC and which made them apply
and pay for Starcomms shares.
In its defence, the bank
challenged the jurisdiction of the
court to entertain the suit and that
it should be dismissed because it
was frivolous and vexatious.
In response to the suit, the bank
argued that it did not conceal any
information in order to induce
the plaintiffs to participate in the
private placement.
The bank also stated that
the plaintiffs never asked
for the Private Placement
Memorandum or for any
information relating to the
business management and
financial position of the second
However, Justice Tsoho in
his judgement, agreed with the
plaintiffs that the respondents
deliberately concealed useful
information which may have
assisted them to reach a more
informed decision.
He therefore declared that the
plaintiffs are legally entitled
to rescind the four Forms of
Commitment for 100 million
units of Starcomms’ shares
which were subsequently
manipulated by Stanbic IBTC
and were improperly and
unlawfully treated as three valid
applications for subscriptions
and purchases under the private
placement exercise.
The court also ordered the
second defendant to cancel
forthwith from its register of
shareholders the names of the

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