There may be fresh crisis in the Board of the Abuja Electricity Distribution Company (AEDC), barely 24 hours after new members were named.
Some officials of the dissolved Board, including the chairman, Amb Shehu Malami, said the recent meeting where a decision was reached to appoint new members was illegal.
According to a letter by the old Board members, only Malami can call for a meeting. However, he did not authorise that, and there was the absence of the Bureau of Public Enterprises (BPE), the representative of the Federal Government’s 40 per cent share in the DisCo.
How CECA named new Board
On Friday, CECA Limited, one of the core investors in KANN Utility Company, which acquired the AEDC, issued a statement confirming a change in the Board.
The two companies that make-up KANN are Xerxes Global Investment, fronted by Amb Malami, the AEDC chairman; CEC Africa Limited, fronted by Mr Siyanga Malumo, the AEDC vice-chairman.
According to the statement, the old and pioneer Board of the AEDC and investors in KANN had jointly agreed in their recent meeting to have new members.
Prominent people named include Joseph Makoju, a former NEPA/PHCN head; Ibrahim Aliyu, chairman of the North South Power (Shiroro Hydropower plant), and Olubunmi Peters, CEO of North South Power.
It is expected that KANN would kick-start the process to regularise the new Board listing with the Corporate Affairs Commission (CAC) to effect the decision for the change.
Xerxes mulls lawsuit
Emerging facts have shown that some members of the old Board felt they were not consulted for the meeting that resulted in the new decision.
The Xerxes side of KANN Utility, it was learnt, is contemplating a number of actions, which include filing a legal action on the decision taken without recourse to its members.
The letter, which was written on November 6 by AAA Chambers, on behalf of Xerxes Global Investments Limited, was addressed to the managing director of the AEDC, with the company secretary’s attention.
Titled, Notification of the Illegal and Extrajudicial Meeting of KANN Utility Company Limited held by CEC Africa Investments Limited on November 5th, 2020, the letter stated, “It is pertinent to bring to your attention that our client and CEC Africa Investments Limited, who both hold equal shareholding in KANN Utility Company Limited, have been having a series of litigation in respect of several issues, inclusive of the convening of meetings and shareholding of the company.’’
The letter drew attention to a judgement of the Federal High Court in Abuja, delivered in one of the cases between Xerxes and CEC Africa, in suit number: FHC/ABJ/CS/871/2018, between CEC Africa Investments Ltd versus KANN Utility Company Limited, CECA and Xerxes Global Investments Ltd, on May 8, 2020. It specifically stated that the recent Board meeting was illegal.
“Further to the foregoing, it is pertinent to bring to your notice that the meeting under reference is illegal and extrajudicial as there is a pending appeal in respect of the same.
“Therefore, all decisions and/or resolutions made in the said meeting are null and void, invalid, illegal and constitute an aberration of the pending determination of the appeal at the Court of Appeal, and as such, should not be acted upon,” Xerxes emphasised in the letter.
A copy of the letter, which was signed by the managing partner of AAA Chambers, Adetunji Adedoyin-Adeniyi, was sent to the director-general of the BPE, alleged that the meeting convened by Emmanuel Katepa, who though is a member of the Board of KANN, has no right to convene such meeting without the approval of Amb Malami.
The meeting excluded the BPE (which holds 40 per cent equity on behalf of the Federal Government), as well as Xerxes, which holds 30 per cent shares of KANN (ownership of KANN is still 50-50 between CEC Africa and Xerxes).
It is on these premises that the other investing party said they rejected the new decision to have a new Board.
I didn’t authorize board change AEDC Chairman, Malami
Meanwhile Amb. Shehu Malami, the AEDC board chairman in a statement last night said the Board of AEDC is alarmed by the publication of a purported change of its ownership, and its Board of Directors. It directed the public to ignore the illegality from a shareholder of KANN.
He said, “For the records the Board of AEDC is the only authorised body that can appoint or remove its directors, and has made no such decision in recent time.
“As a matter of fact, the last meeting of AEDC Board was held on 22nd October 2020, and at that meeting there was no such appointment or removal of any director by the Board of AEDC. Since then, there has not been any other meeting of AEDC Board known to me as its Chairman, or known to any of the directors on the Board of AEDC that represent 70% majority holding.
“We have also learnt that there was another attempt to change the composition of the Board and shareholders of KANN at the CAC. I would like to state here that the Board of both KANN and AEDC remains unchanged. The Board of each of the companies is responsible to appoint or remove its directors, and this has not happened,” Malami clarified.
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