FBN Holdings recorded an 8.05 percent week-to-date (WTD) gain in its share price, closing at ₦30.20 on January 10, 2025, despite being embroiled in a contentious loan dispute with General Hydrocarbons Limited (GHL).
The rise reflects resilience amid ongoing legal and operational uncertainties.
The dispute centres on a loan transaction initiated during Mr. Oba Otudeko’s tenure at FBN Holdings, aimed at leveraging profits from Oil Mining License (OML) 120 to reduce First Bank’s non-performing loans and mitigate provisions in 2021. GHL has accused the bank of failing to honour its commitments under the agreement.
Tensions escalated when First Bank froze $225.8 million of GHL’s funds across banks, an action GHL claims contravenes a prior court ruling. In response, the Federal High Court in Lagos issued a Mareva injunction on December 30, 2024, freezing GHL’s assets over the disputed loan. GHL has vowed to challenge the ruling, alleging that it hampers their operations and violates previous court orders protecting OML-related transactions.
The legal battle has also stalled critical oil exploration activities under OML 120. Mediators have proposed restructuring GHL’s leadership and appointing independent asset managers to resolve the issue, but both parties remain divided, delaying progress.
Amid these challenges, FBN Holdings faces pressure from a group of shareholders who have requested an Extraordinary General Meeting (EGM) under Section 215(1) of the Companies and Allied Matters Act (CAMA). These shareholders, representing 10 percent of the company, aim to discuss the removal of FBN Chairman, Mr. Femi Otedola, and Mr. Julius Omodayo-Owotuga, a non-executive director and deputy chief executive of Geregu Power Plc.
In response, FBN Holdings’ company secretary, Mr. Adewale Arogundade, assured stakeholders in a statement posted on the Nigerian Exchange (NGX) that the dispute and EGM request do not affect the group’s operations. He emphasised the company’s commitment to safeguarding its interests and continuing its growth trajectory.
“The Group’s performance continues to improve, resulting in a higher market capitalisation even as we work towards surpassing the regulatory minimum capital well ahead of the deadline,” Mr. Arogundade stated.
FBN Holdings has demonstrated notable resilience in the face of challenges. The stock began 2024 at ₦23.55, reaching a peak of ₦35.55 in March amid strong trading volumes. However, uncertainties around the Central Bank of Nigeria’s recapitalisation mandate saw prices dip to ₦23.90 in April, and further to ₦20.95 in July.
Recovery began in August, with the stock closing 2024 at ₦28.05, delivering a 19 percent year-to-date gain. The bullish momentum has carried into January 2025, with shares reaching ₦30.20 backed by a monthly trading volume of 272 million shares.
Despite the ongoing legal and shareholder disputes, FBN Holdings’ ability to sustain investor interest reflects the market’s confidence in its long-term growth potential and strategic direction.
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