Billionaires’ war: Elumelu silent hours after Otedola’s bombshell

The Chairman of Transcorp, Tony Elumelu, has kept sealed lips about twenty-four hours after a bombshell from the billionaire businessman, Femi Otedola over sale of his shares in the Nigerian conglomerate, Transnational Corporation Plc. Elumelu and Otedola have been entangled in what can be easily described as a cold war. On Tuesday, Otedola hit at […]

The Chairman of Transcorp, Tony Elumelu, has kept sealed lips about twenty-four hours after a bombshell from the billionaire businessman, Femi Otedola over sale of his shares in the Nigerian conglomerate, Transnational Corporation Plc.

Elumelu and Otedola have been entangled in what can be easily described as a cold war.

On Tuesday, Otedola hit at the Chairman of Heirs Holdings and founder of Tony Elumelu Foundation, for allegedly betraying him on different occasions.

He also revealed his offer to buy the conglomerate for N250 billion was rejected.

How Tony Elumelu betrayed me – Otedola

Elumelu overtakes Otedola, controls 25.58% Transcorp stake

Last month, Otedola disposed of the 6% shares he owned in Transcorp to Heirs Holding Ltd after both of them seemed to have publicly displayed affection for each other and agreed to work together.

Otedola initially acquired a 5.52% stake in the company back in March, making him the second largest shareholder of the company. The announcement of the acquisition immediately triggered a scramble for the shares of the company as investors sensed a buying opportunity. The share price more than doubled within a matter of weeks.

But as Otedola increased his stake to just over 6%, Elumelu via his special purpose vehicle, Heirs Holdings, also upped his stake taking his ownership of the conglomerate to about 25.5%.

In a statement on Tuesday, Otedola recalled how he “enthusiastically gave him (Mr Elumelu) $ 20 million, which was N2 billion at that time” to buy the necessary shares for the acquisition of UBA in 2005, alleging that Elumelu betrayed him in the end.

The statement read in part, “In 2005, while Tony was the Managing Director of Standard Trust Bank he approached me to get funds to acquire UBA. I enthusiastically gave him $ 20 million, which was N2 billion at that time to buy the necessary shares in UBA for the acquisition. After a short period of time the share price moved up and I decided it was a good moment to sell and get out of the bank. However, Tony appealed to me to hold on to the shares as he was convinced that there were future prospects – so I kept the shares.

“I became Chairman of Transcorp Hotel in 2007 with a shareholding of 5% and unknowingly Tony gradually started buying shares quietly. By the following year in 2008 I went bankrupt in Nigeria. Tony proceeded to take my shares in UBA to service the interest on my loans and he also took over my shares in Africa Finance Corporation, where I was the largest shareholder.

“Shortly after, Albert Okumagba informed me that an American firm wanted to acquire my shares in Transcorp, which I then agreed to sell. However, this supposed American firm turned out to be Tony Elumelu. The revelation of this prompted me to resign as Chairman of the hotel.”

Otedola said years later in 2012, he told Elumelu about his interest in Ughelli Power Plant and the Transcorp chair “quietly went ahead” to outbid him in the acquisition of the plant.

“Tony said he wanted to see me so we met in my office where I had previously had a meeting with foreign investors who had not yet departed the premises. Curious to know, he asked what sort of meeting I had had and I disclosed that I wanted to go into the power business, specifically Ughelli Power Plant. Tony quietly went ahead to bid for Ughelli and he outbidded me by offering to buy the plant for $300million,” he added.

Otedola said his goal was to maximize Transcorp’s potential as a Nigerian conglomerate with a market cap of at least N2 trillion instead of the current N40 billion, but it seems some shareholders have a different vision.

However, more than 24 hours after Otedola’s bombshell, Elumelu has kept mum over the controversy.

Daily Trust reports that when Otedola’s statement was the major issue in the news on Tuesday, Elumelu was in Rivers State for the unveiling of the Afam 3 Fast Power 240-megawatt turbine.

The 240MW Afam three fast power plant built by Transafam Power Limited, a subsidiary of Tony Elumelu’s Transcorp Group, is located in Oyigbo, Port Harcourt, River State.

The project was commissioned by Vice President Yemi Osinbajo.

Elumelu during the unveiling, emphasised that electricity is the single most critical factor for lifting people out of poverty and enabling job creation.

“The journey has not always been easy – but we have delivered: capacity recovery, plant investment, infrastructure improvement, excellent community relationships, and a transformed and motivated workforce.

“Since its inception in 2006, Transcorp Group has led the way in demonstrating the success of successive privatisation programmes,” he said.

Ramon Nasir, a spokesman for Elumelu, did not respond to a message sent to seek his reaction to the cold war between the duo who are among the most wealthy Nigerians.