SHAREHOLDERS are worried as the Securities and Exchange Commission (SEC) keeps silent over investors’ money paid by Olam International Limited to acquire Dangote Flour Mills Plc.

The shareholders of Dangote Flour, on Monday, October 15, 2019, unanimously approved the acquisition by Crown Flour Mills Limited, the Nigerian subsidiary of Olam International, a global food and agri-business conglomerate.

The approval followed after Olam International paid N120 billion, through a scheme of arrangement, acquired the 4,994,886,771 ordinary shares of 50 kobo each in Dangote Flour with an offer of N24.00 per share exit price to investors.

In a regular filing on November 1, 2019, Olam International announced the completion of the 100 per cent acquisition of Dangote Flour Mills.

The company said, “Naira Escrow Consideration has been funded and the DFM and the registrar have been notified by the Escrow Bank. The scheme consideration will become due and payable by the registrar to the shareholders within four days of the transfer date.”

Shareholders are wondering what could have happened to the funds and why the SEC is “withholding” investors’ money. And also why the regulator has assumed the role of an operator.

“If the funds were with the registrar, it only takes about two weeks for the registrar to pay investors their share,” a shareholder, Abel Ezekiel, said.

In 2021, the SEC allegedly took over the fund paid by Olam International from the registrar, Crescent Registrars Limited, and kept promising to pay investors their money, The ICIR gathered.

One of the email messages from SEC’s senior manager, Investor Protection Division, Enforcement Department at SEC, Malachy Ogu, forwarded to The ICIR, dated October 13, 2022, read, “The Commission is working out the modalities for the scheme consideration pay off. As soon as this is ready, all affected investors will be paid. Please be patient.”

Another, dated June 23, 2023, partly read, “The Commission is working hard to ensure that investors in the affected companies that were delisted or acquired are paid their Scheme Consideration Pay-Off/Return Monies. Please be patient, you will be paid.”

SEC didn’t respond to enquiries despite consistent follow-ups over two weeks

The SEC did not respond to The ICIR enquiry over the matter after frantic efforts for more than two weeks to have the commission speak.

On August 9, The ICIR requested comment on the issue from the SEC through its head of corporate communications, Efe Ebelo. Still, she replied, “Good afternoon, kindly direct your inquiries to Mr. Bagudu. I think I sent you his number the other time.”

But then this reporter responded, “No, you haven’t sent his number to me. Kindly send it, ma. Thanks!”

Instead, Ebelo sent the number of Joy, whom she addressed as the current head of corporate communications at SEC.

The ICIR then sent the enquiry to Joy; on the same day, she replied, “Good afternoon, Alex. Thank you for reaching out. I’ll inform the appropriate department and revert. Thank you.”

On August 10, Joy said, “Hello, Mr Alex. I’m reaching out to inform you that I have informed the relevant department of your inquiries and awaits response. Thank you.”

On August 14, The ICIR reminded her, and she responded, “Good afternoon, Sir. Apologies for the late response. I haven’t received the responses to your enquiries, yet. I crave your indulgence. Thank you.”

Still, on August 18 The ICIR sent another reminder to Joy, and she responded, “Good evening, Sir. Please, I still await response from the department concerned.”

The ICIR also reminded her on Wednesday, August 23, but there was no response.

After two weeks of no response, The ICIR, on Thursday, August 24, further contacted the head of department, external relations at SEC, Bagudu Waziri, to speak on the matter.

Although he promised to give it the necessary attention, Waziri did not respond till the time of filing the report.

Also, Crescent Registrars did not respond to messages when contacted via its official email address. However, a former staff of the company said some investors have been paid, and the remaining funds returned to the SEC.

“Some investors have been paid off. There was a time limit to that payment on the prospectors during the annual general meeting.

“The timeframe was 2019 to 2021, after which the registrar was authorised to send the remaining fund back to SEC, which they have done.”

Too many indictments on SEC’s financial integrity

The current director general of SEC, Lamido Yuguda, under whose leadership the regulator has clinched onto investors’ money,  assumed office on Monday, July 6, 2020.

The ICIR reported on August 26, 2022, that the then accountant-general of the federation (AGF), Ahmed Idris, berated the commission after it remitted N86.8 million out of N4 billion it generated in 2019 into the Federal government’s Consolidated Revenue Fund (CRF).

Similarly, the Senate had recently beamed its light on SEC over the vehicle allowances scandal.

A report on May 15 revealed that the Upper Chamber fingered the commission for a N594 million vehicle allowances scandal and mandated the affected officials to refund the money to the CRF.

According to the report, the decision to indict the SEC was a sequel to the failure of the commission officials to defend the serious allegations raised in the 2018 Auditor General report.

The ICIR had, on July 5, reported that the SEC had continued to defy the law by refusing to publish its annual reports since 2015; a regulatory practice the commission is duty-bound to and represents the core of transparency and accountability surrounding its operations.

Many shareholders and market analysts believe these indictments raise concerns about the SEC’s integrity in financial management.

SEC is usurping its powers – stakeholders

“We were told that SEC collected the remaining money back to Abuja and has been in the custody of SEC, which we have demanded SEC to return to the registrar because the registrar remains the very point of call for shareholders to access their money, not SEC.

“If you have N5,000 to collect, I don’t know how you are going to enter an Aeroplane or bus to go to Abuja to request your N5,000,” the chairman, Progressive Shareholders Association of Nigeria (PSAN), Boniface Okezie, lamented.

He maintained that the registrar remains the best bet for shareholders to approach and not the SEC to get their payoff.

“This is not an unclaimed dividend, so why should the SEC saddle itself with it,” the PSAN chair queried.

He noted that for years, shareholders have been contacting the SEC and sending messages, but the authority has promised to return money to no avail.

“But up till now, as we speak, the money has not been returned; we don’t know what their issue is. They said the SEC management has resolved to return the money to the registrar for upward payment to the shareholders.

“Most of the time, I will receive a response that shareholders have besieged the registrar as people could not believe what the registrar is telling them. Why should the SEC collect that money which is not an unclaimed dividend,” Okezie lamented.

The ICIR reported on March 18 that the SEC is rooting to take over unclaimed dividends and establish an unclaimed dividend trust fund.

“For me, it is a fraud. Nigeria has not helped anybody to invest in shares. It is people’s sweat, so why should the government be interested in having people’s money?

“This country is where they rub the poor to accumulate wealth for themselves. People who suffered to invest can’t have access to their money,” Okezie said.

He suggested that if the SEC were to be interested in protecting investors, the commission should do so by liaising with the registrar to disburse on daily, weekly or quarterly and demand that reports be sent to it.

“That is what the SEC should demand until that money is fully paid to investors. That should be the work of the SEC, unfortunately they are not doing it.

“If unclaimed dividends today go to the SEC’s coffer, we would not see that money again. Ordinary principal investors’ money from Dangote’s people cannot lay hands on their money.

“The interest it would have accumulated, who is eating the money? If SEC returns that money today, is it the amount they collected they are returning or with the interest it should have accumulated? Okezie added.

An investment and portfolio analyst, Abel Ezekiel, noted that SEC holds the responsibility to protect investors’ interests and not to induce undue suffering on shareholders.

“The issue on the ground is the acquisition of Dangote Flour by Olam in 2019, of which there is a payment consideration of N24 per unit, which the registrar has started paying.

“You contact the registrar, they pay you. And that continued until 2021. It was after 2021 the SEC took it over. From 2021 till date, to the best of my knowledge, no investor has been paid.

“I went to SEC myself at VI (Victoria Island), they keep giving empty promises to pay for something that ordinarily takes within two weeks. Why should it take them this long? He also queried.

If SEC could not be transparent with the Dangote Flour payoff to investors, Ezekiel expressed the doubt that SEC would be transparent in managing post-dividend, which the commission is rooting to take over.