Nigerian oil firm Lekoil loses board fight with top shareholder

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Shareholders of London-listed Nigerian oil company Lekoil voted on Friday to approve an investor’s bid to add three members to the company’s board, in the culmination of a bitter dispute between its founder and its biggest shareholder.

The dispute between Lekoil founder and chief executive Lekan Akinyanmi and top shareholder Metallon even drew in Nigeria’s Ministry of Petroleum, and created more unwanted public turmoil for the company, which was caught out by a fraudulent loan last year.

A large majority of shareholders approved Metallon’s proposal to appoint Metallon CEO Thomas Richardson along with two others to the Lekoil board, expanding it to seven members.

Lekoil Chairman Mark Simmonds said he would stand down with immediate effect. The newly enlarged board will appoint his replacement.

Metallon, a private investment company that owns four gold mines in Zimbabwe, became a shareholder of Lekoil last March and now has a 15.1 perecent stake, making it the top investor.

It says its proposal to expand the board will improve corporate governance and increase scrutiny of Lekoil’s finances.

“Today’s EGM result has delivered a clear mandate for change, in line with Metallon’s primary objective of a strengthened board, greater oversight and stronger governance at Lekoil, in order to unlock greater shareholder value for all,” Metallon CEO Richardson said in a statement after the vote.

Akinyanmi fought the change, and has said that if Metallon succeeded, they could be in “a very strong position to make a takeover attempt.”

After the vote, Akinyanmi struck a conciliatory tone.

“Now it is time to move forward and start the process of healing and reconciliation as we focus on our common and shared objective of creating and delivering value for all our stakeholders,” he said.

Lekoil is also facing scrutiny from Nigeria’s Ministry of Petroleum Resources for not notifying it over Metallon’s build-up of shares in the company.

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