Oando Nigeria confirms it is under SEC investigation

Oando Nigeria

Oando Nigeria has finally confirmed it is under the investigation of the Securities and Exchange Commission. However, the company is more or less denying there was any wrongdoing.

In a statement released by the company, Oando said:

Our attention has been drawn to a report released by Channels TV on Friday the 14th day of July, 2017 stating that Oando PLC (“the Company” or “Oando”) is “…under a comprehensive investigation by the Securities and Exchange Commission…..following petitions filed by some foreign investors in Oando Nigeria PLC, in relation (sic) shareholding structure following the 1.65 billion Dollars cash that Oando paid in June 2014 to acquire the oil production assets of Conoco-Phillips in Nigeria…”.

The Company understands that the SEC is in receipt of correspondence containing (in our opinion) unsubstantiated, misleading and defamatory claims with respect to various matters that had already received board, shareholder and where required SEC approval. The Company is fully co-operating with the SEC in the discharge of its duties as the capital markets regulator by providing all appropriate clarifications and rebuttals on the matters raised in the said correspondence. Oando will be happy to provide full disclosure of the outcome as soon as the SEC review is completed.

Oando’s corporate communications team is always available to respond to any enquiries by members of the public and media. The Company is concerned about media houses going public with information without first obtaining a balanced view as this may in some cases lead to the publication of unconfirmed, misleading and damaging information.

Oando is a public listed company quoted on both the Nigerian and Johannesburg Stock Exchanges and any damaging information in the public domain could have a material impact on the Company.

We therefore demand an immediate retraction of the report and urge media houses to refrain and/or desist from further publications in future, without first verifying the accuracy of such facts from Oando.

It would be recalled that PageOne.ng had reported last week that Oando Nigeria PLC was under investigation by the SEC over the purchase of oil assets belonging to ConocoPhillips.

In retrospect, ConocoPhillips acquisition has indeed cost Oando Nigeria a lot of losses that almost led to its bankruptcy. In its belated 2014 full year result, Oando posted a net loss of NGN184 billion. This shocked the entire market on its ability to exist as a going concern should the rally in global oil price continues to move in negative directions.

To salvage the company’s fortunes, the company took drastic steps to clean up its battered balance sheets. Last year, Oando rallied 9 banks to secure NGN94.6 billion as a five-year Medium Term Note, MTN borrowed at the Nigeria Interbank Offered Rate, NIBOR plus 200 basis points. At the signing ceremony, the company said it would be used to meet its financial obligations in the low crude oil price environment.

It is becoming apparent that the cleaning done to its balance sheet after the ConocoPhillips acquisition went sour, has led to further question marks.

The SEC has not released a statement on the matter.

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