Zenon Petroleum and Gas Limited has filed a winding-up petition against Prudent Energy and Services Limited, Ardova Plc’s parent company, for more than $6 million in debt.
AbdulWasiu Sowami, CEO of Prudent Energy and Services Limited, purchased a 74.02 percent ownership in Forte Oil Plc in 2019 through his investment portfolio, Ignite Investments and Commodities Limited.
According to reports, Zenon Petroleum & Gas Limited and its affiliates sold 74.02 percent of the issued share capital of Forte Oil Plc (now Ardova Plc) to Sowami and Ignite Investment & Commodities Limited in 2018 in a suit filed at the Federal High Court in Lagos with the case number FHC/L/CP/1450/2022.
According to the court filing, as security for the deferred consideration for the sale of the shares, Prudent Energy and Services Limited and Sowami gave a guarantee in favour of Zenon Petroleum & Gas Limited and its affiliates for the timely payment of the deferred amount when due.
It further claimed that $6 million of the deferred payment became due on June 18, 2022, and that despite many demand letters, the corporation refused to fulfill the obligation.
As a result, it petitioned the court to declare Prudent Energy and Services Limited bankrupt due to its inability to pay its bills.It was concluded that the problem began when the company “diverted N25 billion bond fund raised last November”.
“There are also unconfirmed reports that the proceeds of the recent bond issue have been diverted to other uses other than what they were intended for,” the source said. In its 2021 financial statement, Ardova Plc posted a N3.9 billion loss in the year compared with an N1.9 billion profit recorded in 2020.
The Nigerian Exchange (NGX) Limited had last month suspended trading in the shares of Ardova and some other companies over their failure to file their audited financial statements for the 2021 accounting year.
However, the suspension was lifted by NGX Regulation Limited, the regulatory arm of the domestic stock exchange, after the company submitted its results, even though it was poor as it recorded an N3.9 billion loss in the year compared with the profit of N1.9 billion it reported the preceding fiscal year.
The loss recorded by the oil and gas company stemmed from a high cost of sales and operating costs that ate into its margins. Ardova had blamed the losses on its subsidiary, Axles & Cartage, a transport and haulage services business that commenced operations in August 2020. It also blamed transformational challenges with its recently acquired Enyo Business as part of the reason for the huge loss.
