Daily Independent (Lagos)

Lagos — Afribank Plc has filed a winding up petition before a Federal High Court sitting in Lagos against an oil firm, Imad Oil and Gas Limited, over alleged failure of the firm to liquidate a credit facility of N661.1 million.

Already, the court presided over by Justice Okechuwku Okeke has granted an order permitting the bank to advertise the petition in the official gazette of the Federal Government and two national dailies.

Justice Okeke gave the order after listening to the argument of the counsel to the bank, Joseph Nwobike (SAN), who stated that all efforts to make the oil marketing company repay its debts had proved abortive.

He argued that in line with Sections 401,408, 409 and 410 of the Companies and Allied Matters Act Cap C20 Laws of the Federation, 2004, it was imperative for the company to be wound up because evidence available showed that the oil firm was bankrupt.

In the petition, Nwobike explained that sometime in January 2008, the respondent, pursuant to banker-customer relationship, applied for and was granted an overdraft facility by the petitioner in the sum N250 million to enable it purchase 500,000 litres of petroleum products from oil dealers such as MRS, AP or any other company on the terms and conditions stated in the offer letter dated January 25, 2008.

He stated that further to the existing facility, the respondent also applied for and was granted an import finance facility by the petitioner for the sum of $4,190,000 for a tenor of 90 days to enable it part-finance the importation of 5,000 metric tonnes of automotive gas oil from Vitol S.A in Geneva on terms they both agreed upon.

Nwobike argued that from the fact that the bank would rely on the offer letters during the hearing of the case, as part of the conditions to draw down the overdraft facility, the respondent presented its board resolution accepting the facility and executed an undated bill of sale, chattel mortgage, among others and subsequently drew down and fully utilised the facilities.

He explained that after the expiration of the tenure of the facilities, the current indebtedness of the respondent to the bank was in the sum of N661,181,232 as at May 25, 2010 and interest continues to accrue.

He added that despite repeated demands, the respondent has refused to pay the debt, a development he (Nwobike) described as an indication of insolvency.

The matter has been adjourned till July 29 for hearing.

Be the first to Write a Comment!

Copyright © 2010 Daily Independent. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.