Court nullifies Jimoh Ibrahim ownership of Newswatch dallies

(Nigeria)Federal High Court in Lagos, on Monday, quashed a Share Purchase Agreement (SPA) which transferred ownership of Newswatch Communications Ltd to erstwhile businessman, Mr Jimoh Ibrahim.   
Two minority shareholders, Mr Nuhu Aruwa  and Prof. Jubril Aminu had filed a petition, praying the court to quash a share purchase agreement which transferred ownership of the company to Ibrahim.
The applicants are also seeking an order, restraining the respondents from publishing and selling to the public, Newswatch daily and weekend magazines.
In addition, they are seeking an order restraining the publications of Saturday Newswatch, Sunday Newswatch and the daily Newswatch.
Respondents are: Newswatch Communications Ltd, Global Media Mirror Ltd, Mr Jimoh Ibrahim, Newswatch Newspapers and the Corporate Affairs Commission.
Delivering judgment in the suit on Monday, Justice Ibrahim Buba upheld all the prayers of the minority shareholders.
The judge also awarded the sum of N15.7 million damages against the Ibrahim, as well as an order, stopping further publications of Newswatch Daily.
Buba held that the respondents could not prove that they paid up for the shares, as the petitioners gave evidence to show that the second to third respondents totally failed to pay for the shares of the Company.
Buba "They have not showed how and when they paid for the said Shares, and nothing in paragraph 11 and 18A of the respondents’ statement of defence shows how they paid for the shares.
"There is no evidence in paragraph 3.0 that the respondents paid on or before May 5, 2011, as stated, as they have only given their interpretation to that paragraph.
"Whatever monies they spent was spent on Daily Mirror and this was confirmed by DW2 during cross examination.
"The N510 million was supposed to be paid for Shares and not for any other purpose; there is no evidence to show that the Shares have been paid for.
"Besides, it was a company called Global Fleet that paid the N14 million, not any of the respondents who contracted with the first respondent".
Buba therefore, held that the case of the petitioners have merits, and so, granted all the reliefs as prayed.
The court grants all the reliefs as set out on the petition at the inception of this case as follows:
"An order setting aside the contract entered into between the first and second respondent companies by virtue of document titled “Share  Purchase Agreement" between the first and second respondents executed in May, 2011.
"A Consequential Order setting aside the Form CAC2 ( Statement of Share Capital and Return of Allotment of Shares) of the 1st Respondent company dated Aug. 27, 2012, and presented for filing by one Gloria A. Ukeje.
"An Order directing the 2nd and 3rd respondents jointly and severally, to pay special damages in the sum of N15.7 million to the first respondent Company, being loss of Business profits since August 2012 till October 2012 when its operations were unilaterally shut down."
The court also held that the Petitioners had discharged the burden placed on them by proving their case, while the first to fourth respondents failed woefully to discharge the burden placed on them.
The petitioners had averred that the 2nd and 3rd respondents purportedly came into
majority ownership of the Newswatch Communications by virtue of a Share Purchase Agreement entered into in May 2011.
They averred that by virtue of clause 3.0 of the said agreement, the 2nd respondents purportedly acquired 51 percent of the company, on the condition that they pay the sum of N510 million as price of its shares.
They added that by clause 4.0 of the  agreement, the money was to be paid on or before May 5, 2011, and that the 2nd respondent was obligated to pay additional N500 million within 90 days after take-over, which was supposed to serve as working capital for the company.
The petitioners averred that without complying fully with the aforementioned conditions of  agreement, the 2nd respondent through the instrumentality of the 3rd respondent went ahead and took over full control and management of the first respondent company.