*Jettisons court order

BY PETER EGWUATU & ABDULWAHAB ABDULAH

LAGOS – FinBank Plc, yesterday, held its Extraordinary General Meeting  where the shareholders approved merger with First City Monument Bank Plc, FCMB.

Similarly, shareholders of  FCMB, yesterday, endorsed a proposed acquisition of Finbank  Plc and the $50 million International Finance Corporation, IFC,  loan obtained by the bank.

Barely a day ahead of the Central Bank of Nigeria, CBN,  September 30 deadline for recapitalisation of rescued banks, FCMB shareholders unanimously approved the acquisition of Finbank Plc, thus paving way for further negotiations for 100 per cent acquisition deal between the banks.

The shareholders at the Extraordinary General Meeting, supported the acquisition deal with 99.97 per cent of votes cast by shareholders present in support of the  bank’s resolution to acquire Finbank through its wholly-owned investment subsidiary, FCMB Investments Limited, FIL.

However, 0.02 per cent objection votes of minority shareholders failed to count despite a minority shareholders’ warning that any vote to the proposed investment in Finbank would be of no value.

Under the acquisition deal, Finbank shareholders will exchange 60 shares for one FCMB shares.

Meanwhile, a minority shareholder of  Finbank Plc and Managing Director, First Aluminium Nigeria Plc, Mr. Ben Elfrink, claimed that Finbank was in a winding up procedure before the Federal High Court, citing Section 413 of Companies and Allied Matters Act, CAMA,  stipulating that no company being in such procedure can dispose of shares, assets and so on without permission of the court.

Similarly, the shareholders ratified the bank’s loan agreement over loan transaction and convertible loan transaction totalling $70 million from International Finance Corporation, IFC.

Specifically,  the shareholders ratified $50 million loan transaction with IFC for financing its lending operations just as they approved a convertible loan transaction of $20 million, which approval, therefore, authorised the directors to allot ordinary shares to IFC.

With this overwhelming approval, the coast is clear for FCMB to acquire the rescued Finbank based on the terms and agreement spelt out in the transaction implementation agreement,TIA, between both banks.

Meanwhile, the Finbank EGM was in contravention of  an  earlier order of a Federal High Court, Abuja, which had restrained it from going ahead with the said EGM.

Plaintiffs in the suit,  Exclusive International Ltd., Markos Construction Limited and Senator Ifeanyi  Araraume, were on September 28, granted an order by trial judge,  Justice Ibrahim  Auta, barring FinBank Plc from holding its EGM.

The court also restrained the bank from entering into “any scheme of arrangement or merger by whatever name called, pending the determination of the motion on notice dated September 16, 2011 already filed in this suit.”

Respondents in the suit were FCMB,  CBN, and Mrs Suszanine Iroche.

The court had directed the plaintiffs to give undertaking as to damages,  and adjourned the case till October 10, 2011, for hearing.

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