On 24th January 2012, the Federal High Court of Nigeria ruled in favor of Econet Wireless Limited (“Econet”), an international telecommunications group, based in South Africa, in it's dispute with Airtel Networks Limited (“Bharti”), over the ownership of a 5% stake, in Bharti (formerly Econet Wireless Nigeria Limited).
The court ordered that Bharti restore the 5% stake, which was stripped from Econet in 2003, by the board of directors of Bharti. The court also ordered that all resolutions, and decisions taken by Bharti, since November 2003, to date, in which Econet, was excluded as a shareholder, are null and void.
Bharti bought 65% of the company in Nigeria, in 2009, as part of an acquisition of the African businesses of Zain of Kuwait. At the time of the sale Bharti valued, the Nigerian company, which it renamed Airtel Networks Limited, at over US$4,5bn. This would have valued the Econet 5% stake, at over US$220m, at the time.
A written copy of the court's judgment has not yet been released by the Federal High Court. Once this is available, Econet will publish it in full on its website (www Econetwireless.com).
On 26th January 2012, Bharti filed an Application for Stay of Execution in the Federal High Court, requesting the Court to grant it an injunction, and to stop Econet from exercising its rights under the court judgment, until an appeal has been heard, by the Court of Appeals of Nigeria.
The following is an extract from its application, for 'Stay of Execution', as it is called in Nigeria:
“… that:
5.1 the Judgment, particularly the nullification of the decisions held at the meetings to which the Plaintiff #(Econet) was not invited will adversely affect the operations of the Applicant #(Bharti), and its corporate existence, and may impair its ability to effectively prosecute its appeal against the Judgment;
5.2 If the effect of the Judgment is not suspended pending the determination of the Applicant’s appeal, a number of key corporate actions taken by the Applicant will be unraveled and this will cause the Applicant incalculable financial loss.”
A full copy of this application, which is a public court document, is hereby provided: click to download (6.4Mb)
On 8 February 2012 Econet's lawyers in Nigeria, filed an application opposing the Bharti application.
A full copy of this opposing motion, which is a public court document, is hereby provided: Click to download (17Mb) New
The Federal High Court has now changed the date of the hearing, on Bharti's application from 16 to 22 February 2012, in Kaduna, Nigeria. It will be in open court, and members of the public and media, are free to attend.
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