Former CEO of Newswatch Communications Limited, Mr. Ray Ekpu
The former chief executive officer of Newswatch Communications Limited, Mr. Ray Ekpu, Wednesday told a Federal High Court, Lagos that the Group Managing Director of Global Media Mirror, Mr. Jimoh Ibrahim, does not like to pay debt, insisting that he (Ibrahim) short-changed him and the other directors by making only part payment to their retirement benefits.
Ekpu made the statement while being cross examined by the defence counsel, Bolaji Ayorinde (SAN), in the ongoing trial in the suit filed by minority shareholders who are angry over the take over and management style of Newswatch Magazine by Ibrahim.
The shareholders - Nuhu Wada and Professor Jibril Aminu, had filed the suit to challenge the method through which Ibrahim acquired the purported majority shares of Newswatch.
The veteran journalist said Ibrahim cheated him by refusing to pay him a balance of N30 million.
“N79.5 million was given to me out of N109 million due to me and Ibrahim cheated me by keeping the balance of N30 million. Four of the directors had meeting with Jimoh Ibrahim and he called a lady, who is an accountant to read the figure to us; what we were to be paid, figures less than what we expected which we submitted to the board on May 5, 2011.
“When we told him that the figures were less than we expected, he said that is the money available. He just paid us what he wanted. Out of the money he paid, he said he will collect 10 per cent as tax and give us receipt which he never did,” Ekpu stated, adding that efforts to make him pay the balance through letters written to him about the issue did not yield any result.
The court also admitted in evidence copies of the memorandum of understanding containing the names of other companies under the Newswatch group when the plaintiffs counsel, Adekunle Oyesanya (SAN) didn’t object. Prodded by Ayorinde to disclose how much was paid to other directors, Ekpu insisted that he was only aware of his own, adding that he got to know that his colleagues were also cheated and short-paid when they began to complain as well.
The trial judge, Ibrahim Buba, later adjourned the matter to March 18 and 19 for continuation of trial.
At the earlier hearing on Tuesday, a mild drama ensued when Justice Buba announced he was sent a present by one of the parties and expressed displeasure over the unsolicited gifts sent to him by some unknown characters.
The gift, possibly sent to show the judge “the new look Newswatch”, which is the subject matter of the suit, unidentified persons parceled copies of the Newspaper and sent to the judge. The judge became furious over the gift and threatened to withdraw from the suit if the parties were not interested in his continuing with the case.
Justice Buba subsequently raised alarm over the gifts, saying parties must be warned to desist from doing anything that would undermine his integrity.
Obviously displeased with the gift, Justice Buba looked at Ibrahim’s counsel, Bolaji Ayorinde (SAN) and asked whether he (Ayorinde) wants him (the judge) to conclude the case, to which Ayorinde consented.
Justice Buba said: “Do you want me to conclude this case? I asked the question because after the last sitting, I found an unsolicited gift on my table and when I opened it, I found two complimentary copies of Newswatch Daily of February 10 and 11, 2013. My secretary told me that she can identify the person that brought it”, he said, adding that sending copies of the subject matter of a suit before him was not ordinary.
“It is not ordinary because a judge is also on trial over the case he is handling.
If any of the party is not comfortable with me, such person should let me know, and I will return the case file to the Chief Judge for re-assignment to another judge. I must, however, call on parties to refrain from doing things that will undermine the integrity of the court,” the judge stressed in a short bench ruling.
Counsel to the plaintiff, Oyesanya expressed shock at the development, but added that he had the greatest confidence in the ability of the judge to do justice in the matter irrespective of any kind of intimidation or harassment.
Similarly, Ayorinde, who denied knowledge of the development also expressed confidence in the integrity of the judge, but urged the court to give him time to investigate the circumstances leading to the development.
However, Wada who had earlier commenced his own evidence in chief had entered the witness box, where he was further cross-examined by Ayorinde.
Under cross-examination, he insisted that Newswatch was not distressed before Ibrahim took it over, but that they only invited him (Ibrahim) to invest in the company owing to the need for business expansion.
The court admitted four editions of Newswatch Magazines of January 15, 2007; August 3, 2009; April 19, 2010 and November 19, 2011 as exhibits after Ayorinde through Wada tendered them.
In addition, Ekpu opened his testimony before the court where he had stated that at present, he has 4.3 million shares in Newswatch, adding that his shares at inception of the company was 75,000.
Ekpu recalled that himself, the late Dele Giwa, Soji Akinrinade, Dan Agbese and Yakubu Mohammed were the founding fathers of Newswatch.
“Although, our shareholding has changed since then because there have been delusions. For instance, in 1992, the four of us decided to shelve up to five percent of our shareholdings. We sold the shares and gave the company as an interest free loan, although the loan has since been repaid,” Ekpu explained.
Before the court adjourned tomorrow for the continuation of Ekpu’s testimonies, he (Ekpu) also admitted the existence of some subsidiaries of Newswatch, which are Newswatch Books Limited and Newswatch Properties Limited.
According to the suit, Wada and Aminu, who were representing minority shareholders and former directors of Newswatch, accused the new management under Ibrahim of systematically working to kill the company’s main product, Newswatch weekly magazine and replacing same with daily newspapers, to be published by a newly incorporated company-Newswatch Newspapers Limited – an organisation in which Ibrahim’s company, Global Media Mirror Limited owns a majority shareholding.
Wada and Aminu averred that Ibrahim, the new Chairman of Newswatch Communications Limited and the company “have not called a general meeting since the said new illegal take-over of the company.”
They argued that although Ibrahim and his company, Global Media failed to comply with the conditions contained in the contract- a Share Purchase Agreement - of May 2011 between Newswatch and Global Media, Ibrahim and his company “wrongly assumed” the management and control of the company and shut down its operations to the utter detriment and loss of the petitioners.
They also noted that by Clause 3.0 the 2011 agreement, Ibrahim and Global Mirror was to acquire 51 per cent stake in Newswatch Communications on the condition that they pay N510million as purchase price; by Clause 4.0 the money was to be paid on or before May 5, 2011, and by Clause 13.0 Global Media was required to pay additional N500 million within 90 days of its takeover of the company.
“Without complying at all with any of the aforementioned conditions of the agreement, the second respondent (Global Media), through the instrumentality of the third respondent (Ibrahim), went ahead and took over full control and management of the first respondent (Newswatch Communications)”, they stated.
They argued that since the company was shut in August last year, it has lost about N15.780million in revenue and profit, part of which ought to accrue to its shareholders, including the petitioners.
The petitioners are praying the court to among others, nullify the May 2011 agreement; an order directing Ibrahim and Global Media to pay the N15.780 million lost suffered by the company so far and 21 per cent interest on the judgment sum before judgment and 10 per cent after judgment is given and until it is paid.
They are also praying for an order directing that any verified money by Ibrahim and Global Media in Newswatch Communications be refunded to them by the receiver/manager from the funds realised from the operations of the company.