An investor in Union Bank of Nigeria Plc, Dr. Charles Mekwunye (SAN), has urged the Federal High Court in Lagos to nullify the bank’s acquisition by Titan Trust Bank.
The plaintiff, through a team of lawyers led by Mr A.M. Makinde (SAN), had earlier sued Union Global Partners Ltd (first defendant) and Atlas Mara Limited (second defendant) over the sale of their majority shares in Union Bank (fourth defendant) to Titan Trust Bank (third defendant).
Dr. Mekwunye contended that the transaction did not follow extant laws.
He claimed that Titan Trust Bank, which was granted a banking license two years ago, had not broken even and lacked the financial capacity to acquire Union Bank.
The plaintiff told the court the sale of the combined shares of Union Global Partners and Atlas Mara Ltd in Union Bank was done by private treaty instead of being traded on the floor of the Nigerian Stock Exchange as required by law, thereby making the transaction invalid and unlawful.
The Central Bank of Nigeria (CBN) was joined in the suit numbered FHC/L/CS/674/2022 as a co-defendant and was served with the court processes seeking a stay of all actions on the transaction pending the determination of the suit.
While the suit was pending, the plaintiff said the CBN last month announced the official approval for Titan Trust Bank’s acquisition of Union Bank.
In the fresh motion, Dr Mekwunye is praying for a declaration that the CBN’s approval of the transaction was in flagrant disrespect to the authority, sanctity, dignity and powers of the court and, therefore, unlawful, unconstitutional, null and void.
He is praying for “an order of mandatory injunction for a return to status quo by setting aside the approval of the sale and transfer of shares of the fourth defendant by the first and second defendants to the third defendant by the fifth defendant having been unlawfully approved in contempt of court.”
The investor seeks “an order of mandatory injunction nullifying all steps and/or measures taken by the defendants to consummate the transaction of transfer and sale and/or acquisition of shares of Union Bank by the third defendant in flagrant disrespect to the court.”
Other prayers are: “An order of mandatory injunction returning the parties to the status quo as at the first date CBN appeared in court through its counsel in response to the originating summons of May 24, 2022.
“An order that the CBN is in contempt of court for approving the unlawful transaction resulting in the third defendant’s acquisition of the fourth defendant/respondent as evidenced by the fourth defendant’s circular of June 2, 2022, in spite of the suit pending before the court, including the motion on notice for interlocutory injunction filed on May 11, 2022, which is pending before this court.
“An order that the defendants’ failure and/or refusal to maintain status quo in the pending suit before the court undermines the powers and authority of the court.”
Union Bank had on June 2 announced the completion of core investors’ sale of a majority shareholding to Titan Trust Bank.
It also notified the Nigerian Exchange Group of the resignation and subsequent retirement of directors from its board.