N26bn suit: AMCON groans over loss to Capital oil in courts

To Assets Management Corporation of Nigeria (AMCON) officials, a spanner has been thrown into their wheel, going by the Federal High Court order on Thursday that it is to pay Capital Oil and Gas Industries Limited the sum of N26 billion as damages for bridging its rights.

AMCON had been in court with the company on technical issues, bordering on inability of Capital Oil and Gas to meet paying the sum of N150 billion loan facilities it took from a consortium of banks.

AMCON sealed some Capital Oil business premises and threatened appointing a receiver for the embattled company.

But the oil firm contended that it had made commitments to the creditors in line with terms of agreement and later got an interim injunction, which compelled AMCON to vacate the premises, pending determination of the main suit in which Capital Oil was claiming N300 billion, compensation for abuse of rights and privilege.

With similar injunction earlier obtained by NICON and other debtor firms, which debts AMCON is statutorily managing, totaling $300 billion, experts said it could no longer achieve the aim of creating it by government, which is to buy up toxic debts in the system.

Dr. Peter Ezomon, of the department of Business Studies, University of Lagos said: “It’s either that AMCON’s enabling law has some loopholes that the litigants are capitalising on, or that the legal team of the Corporation is not getting their ax well.

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“The establishment of AMCON is the best solution to the menace that the Nigerian economy has found itself, coming from the time when banks and other financial institutions were dishing out loans to political godfathers and associates, resulting in bad debt status of today, now recovery is made impossible by courts.”

But for AMCON, many banks could have closed shop, said another expert, adding that the legal system should not be allowed to dysfunction serious approach to the hope of revamping the economy from its present prostrate state.

A legal practitioner, Alex Kachi, said there is no cause for alarm, “All that AMCON needs is to appeal the judgment and go back to the drawing board to ensure that its papers are in tandem with whatever claim they have of the various cases in court.”

At the corporate headquarters of AMCON on Friday, tension-soaked staff were seen expressing concerns over the development.

Said one of them, “If not that we are of government establishment, some of us would have lost our jobs by now; for no single recovery of huge loans have we been able to make since AMCON’s creation in July 2011.”

He confirmed that the latest judgment had put both management and staff in a very tight corner.

A call to the head corporate affairs department of AMCON, Jude Nwauzo, was responded to by an aide, who said the management had been in a marathon meeting on how to react to the court ruling.

By Emma Eke ….

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