Lekoil Limited Says It Will Continue To Act In The Interest Of Its Shareholders

Posted on May 7, 2022

Lekoil Limited has requested its shareholders to disregard the recent statement issued by Lekoil Nigeria and contact it if they have any queries about its operations.

In a statement titled ‘Litigation Summary and Response to Lekoil Nigeria announcement’ released on Thursday, 5 May, LEKOIL, the oil and gas exploration and production company with a focus on Nigeria and West Africa, described Lekoil Nigeria’s suits against it in Nigeria, the United Kingdom, New Jersey, and the Cayman Islands as obstructionist. 

LEKOIL reiterated that it would not be intimidated by the actions of Lekoil Nigeria and its Chief Executive Officer, Mr Lekan Akinyanmi, adding that their action has the “strategic objective of blocking the Company’s legitimate activities and thereby reducing shareholder value.”

The Company’s Interim Executive Chairman, Anthony Hawkins, explained“The litigations brought by Mr. Akinyanmi (funded by Lekoil Nigeria), along with Mr. Akinyanmi’s refusal to repay his CEO loan, make clear that Mr. Akinyanmi, supported by Lekoil Nigeria, is determined to try to frustrate the proper operations of the Company as approved by the majority of its shareholders.

These legal claims have been instigated and pursued despite the fact that Lekoil Nigeria’s offer to purchase shares in the Company was not accepted by the vast majority of the Company’s shareholders; the Savannah Energy Transaction was supported by the Company’s major institutional shareholders, representing approximately 42% of the Company’s then current issued share capital; the entry into the Option Agreement with Savannah Energy was supported by 82% of shareholders at the Extraordinary General Meeting held on April 7 2022 (the Option Agreement being an integral part of the Savannah Transaction); and the issuance of additional shares in the Company was supported by 70% of shareholders at the Extraordinary General Meeting held on April 7 2022.

Hawkins added that the Company has taken professional advice in the Cayman Islands and Nigeria and will continue to act in the best interests of all shareholders and not be intimidated by the actions of Mr. Akinyanmi and Lekoil Nigeria. 

Akinyanmi, a former investment banker based in the United States, founded Lekoil and incorporated it in December 2010 with a holding structure. Lekoil Nigeria emerged as its principal subsidiary before others.

LEKOIL stated that the Company is a party to the following legal proceedings:

·    A claim by Mr Akinyanmi, in the Superior Court of New Jersey, alleging breach of contract in the termination of his employment contract, as further set out in the RNS by the Company dated 24 September 2021.  The Company is challenging the jurisdiction of the New Jersey court to hear the claim.  Following this judgment, the Company will pursue the recovery of the CEO loan in the appropriate jurisdiction. 

·      A claim by Mr Akinyanmi, in the Grand Court of the Cayman Islands, seeking a declaration (amongst others) that the “Share Allotment Resolutions” passed at the Company’s AGM on 21 December 2021 were ultra vires and void.   This would have the effect of challenging the issuance of shares in the Company pursuant to various convertible facility agreements and the contractor shares scheme.  Ancillary to this claim was an ex-parte injunction that, as announced on 11 March 2022, was discharged by the Grand Court.  The Company notes that, following the discharge of the ex-parte injunction, Mr. Akinyanmi has not taken any further active steps in these proceedings but has instead presented a winding up petition, as described immediately below.   The Company also notes that, as part of the proceedings, it was made aware that the Board of Lekoil Nigeria had resolved to “continue to provide financial support to the CEO [Mr. Akinyanmi], and to pay the legal fees incurred in his ongoing legal proceedings in jurisdictions including Cayman Islands, United Kingdom, and United States.

·    A contributory’s petition against the Company filed by Mr. Akinyanmi in the Grand Court of the Cayman Islands seeking the winding up of the Company on “just and equitable” grounds, as notified by the Company on 7 April 2022.   In essence, Mr. Akinyanmi is seeking to have official liquidators appointed to wind up the Company or, alternatively, the entitlement to purchase the shares of all other registered shareholders of the Company at a value to be determined by the Grand Court.

·    An ex-parte injunction granted by the Nigerian Federal High Court on 4 April 2022 upon the application of Lekoil Nigeria and certain of its subsidiaries (the “Plaintiff’s) against the Company and Savannah Energy Investments Limited (“Savannah”), seeking to restrain: (i) the transfer of interests in the Plaintiffs; (ii) altering  the beneficial and/or equity rights of the Company in the Plaintiffs; and (iii) altering (or taking steps to alter) the Company’s ownership, equity, share capital structure, rights or interest in the assets of the Plaintiffs (the “Nigerian Injunction”). The Nigerian Injunction has subsequently been supplemented by an application for a mandatory injunction in respect of the resolutions passed at the Extraordinary General Meeting of the Company held on 7 April 2022.

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