Seplat shareholders tango over $19.4m legal fees spend

Eagle Eye Shareholders, who represent the majority stake in Seplat Energy Plc, have dismissed calls for a probe into the company’s affairs over the recent surge in its legal fees.

The group also expressed confidence in the management’s capability to deliver superior returns and place the organisation on the path of sustainable growth.

The shareholders’ position comes on the heels of calls by a different group of shareholders for a probe into Seplat’s half-year financial results ending June 2023.

On Tuesday, Moses Igbrude, national coordinator of the Independent Shareholders Association of Nigeria (ISAN), and Lemmy Ughegbe, executive director of Make A Difference Initiative (MADI), accused the company of spending $19.4 million on legal fees in its half-year report.

“Very sadly, this $19.4 million represents 23 percent of the company’s closing profit of $82.6 million declared at page 10 of the H1 report,” the groups said in a joint statement.

“When Mr. Roger Brown’s long-term incentive plan (LTIP), which is 2,779,181 shares, an equivalent of £3.6 million or $4.7 million (N4.8 billion) in the same period is added to the $19.4 million professional fees, it comes to about $24.1 million, representing 29 percent of the company’s net profit in H1.

“Yet, Seplat has been beating its chest for declaring a total dividend of $17.6 million for its shareholders for Q2 (second quarter). This is the height of profligacy, and we condemn it in its entirety. Worse still, the issues that necessitated the legal action are yet to be addressed but instead exacerbated.”

‘IGBRUDE’S ACTION WAS ILL-MOTIVATED’

Speaking on the matter, Eagle Eye described the joint press conference by ISAN and MADI as a platform to regurgitate stale and erroneous allegations against Seplat.

“As representatives of the majority shareholders of Seplat Energy, we are appalled by this renewed media offensive, after a seeming truce ostensibly occasioned by the reversal suffered in the law courts, by this group of individuals led by Mr. Moses Igbrude but apparently being aided and abetted by a former major shareholder of the company,” Eagle Eye said.

“We consider it a travesty that Mr. Igbrude, whose initial sponsored petition introduced the flurry of false and orchestrated allegations against Seplat, its CEO, and its directors/officers, still has the temerity to be grandstanding.”

Eagle Eye accused Igbrude of being behind the initial actions taken by the ministry of interior and the criminal charge brought against Seplat and its officers.

“It is also an irony that Igbrude and his cohorts will be talking glibly about the provision for legal fees made in the company’s half-year report when they were the same people who ignited an avalanche of lawsuits that necessitated the need for Seplat to defend its hard-earned reputation and the high integrity of its officials,” the statement reads.

“The chicanery, which the cases evinced, just like this recent joint press conference, offended civilised conduct even as it stretched freedom of expression to an absurd limit.

 “We were alarmed that a company in which we have made a significant investment and from which we derive ample returns will be unduly maligned and castigated in public by a clique of 13 minority shareholders holding less than 800 shares out of 589 million shares (0.0001 percent of the company’s issued shares).”

Furthermore, the group urged the various regulatory agencies in Nigeria to ignore ISAN and MADI, describing them as “crying wolves”.

“It is clear from the excellent results for the first half of 2023 that Seplat has put its recent travails behind it, delivering good returns despite the distractions faced as a handful of shareholders orchestrated jumped-up allegations against the company and its leaders and successfully defended,” the statement reads.

“We urge the Financial Reporting Council of Nigeria (FRC), Securities and Exchange Commission (SEC), the Corporate Affairs Commission (CAC), and other responsible government agencies like the Independent Corrupt Practices and Other Related Offences Commission (ICPC) and the Economic and Financial Crimes Commission (EFCC) to roundly ignore Igbrude and his likes whose penchant of crying wolf where there is none is becoming legendary.