Following a petition filed by the Chairman of Indigo Drilling, Prof. Fidelis Oditah, for the winding of the company, a Federal High Court in Lagos has ordered the processes be served on Transocean Limited, a multinational offshore drilling company.
The court presided over by Justice M.S. Hassan, while ruling on the ex parte application filed by Oditah, ordered that the writ of summons and other processes be served on Transocean Limited at its registered office at Turmstrasse 30 CH6312 Steinhausen, Switzerland through courier service.
Justice also directed that same processes be served on Sedco Forex International Inc at P. O. Box 10342, 36C Dr. Roy’s Drive, Bermuda House, 4th Floor, Grand Cayman, KY-1-1003, Cayman Islands through courier service.
He consequently adjourned the suit to July 2, 2020 for report of service.
Oditah, a Queen’s Counsel (QC) and Senior Advocate of Nigeria (SAN) in his statement of claim attached to the court order, said in 2014, Transocean presented a prospectus for an equity private placement of US19.6million to investors.
In the petition which has Transocean Limited, Indigo Drilling Limited, Sedco Forex International Inc, Field Offshore Design Engineering Nigeria Limited and Ernest & Young Nigeria as 1st to 5th defendants respectively, the QC said the amount, which contained an initial financial model, anticipated that Indigo Drilling would generate a cumulated cash flow of at least $95million over a 10-year period.
He added that the prospectus also indicated that five contracts existing at the time of the placement which were entered into in 2011, were expected to generate a cash flow in excess of $43million over the first four years, thus significantly outperforming the base case financial model.
The professor of Law contended that the prospectus claimed that investing in Indigo Drilling was an opportunity for Nigerians to be involved in the oil and gas business in Nigeria and to profit from its potential rewards.
He said: “In marketing Indigo Drilling to the plaintiff, Transocean stated: Transocean is a leading international provider of offshore contract drilling for oil and gas wells.
“As evidence of its long term commitment to Nigeria, Transocean has set up Indigo Drilling Limited to be a Nigerian NCD compliant company established to ultimately operate all drilling contracts for Transocean in Nigeria…”
Oditah said on the basis of these representations, he acquired a 12.5 per cent shareholding for $4,375,000 in August 2014.
The senior advocate disclosed that another Nigerian shareholder, Chime Ibeneche, also in October 2013 acquired a 12.5 per cent shareholding in Indigo Drilling for $5million
He said as a result of the acquisition of 25 per cent shareholding by Nigerian minority shareholders, Indigo Drilling was able to comply with the Local Content Law and bid competitively for work with the Nigerian regulatory authorities and got extensions of its existing contracts.
The Queen’s Counsel said the remaining 75 per cent shareholding was held indirectly by Transocean initially through its subsidiaries –Sedco Forex and Transocean Support Services Nigeria Limited.
He alleged that from 2015, Transocean parked 26 per cent of its shares in Indigo Drilling in a Nigerian nominee in order to deceive the Nigerian regulators into believing that Indigo Drilling was a Nigerian company under the Local Content law because Nigerians held 51 per cent shareholding.
According to him, while all these were going on, Transocean also controlled Indigo Drilling’s board of director, having appointed two of the three directors – himself, Olamide Abudu and Steve McFadin.
He further alleged that Transocean acted as if it were a sole director of the company and completely bypassed Indigo Drilling’s board of directors, subverted its corporate governance and systematically misappropriated and stole the company’s cash and other assets.
He further revealed that as the chairman of Indigo Drilling’s board of directors, he has no idea in which bank the company’s cash is kept, adding that Transocean and its officers fully control the operation of Indigo Drilling’s bank accounts and the flow of funds in and out of the account without any regards for proper corporate governance.
The senior advocate said no annual budgets were presented to Indigo Drilling’s board of directors for approval, instead Transocean set and altered the budgets to suit its own purposes and not the company’s
He also accused the company of other sundry shady deals.
However, Transocean has asked the court to strike out the suit for lack of jurisdiction.
In a written address filed in support of its preliminary objection, the multinational company said the suit was incompetent.
Through its lawyer, Babatunde Fagbohunlu, Transocean argued that from the averments contained in his statement of claim, and the reliefs sought, it was clear that the plaintiff seeks to protect his right and interest and obtain remedies for wrongs purportedly done to him, which therefore represents a claim filed by a member of a company for or on behalf of the company.
It added that by Section 299 of the Companies and Allied Matters Act (CAMA), only a company can sue to remedy a wrong done to it.