A former Abia State Governor, Orji Uzor Kalu, has sold his banking group’s entire issue shared assets of First International Banking (FIB) Group Limited, Gambia today.
The transaction was concluded between 2015 and 2016, which has never been made public.
The papers revealing the transaction were collected from two offshore secrecy companies (Appleby and Asiaciti Trust) and 19 secrecy jurisdictions worldwide in a leaked information collected by the German newspaper, the Suddeutsche Zeitung, and the International Consortium of International Journalists (ICIJ).
The 1.4 terabyte leaked information, called Paradise Papers, consists of 13.4 million records and is undoubtedly one of history’s biggest leaks.
The bank was purchased by a New York-based investment fund, Lilium Capital, according to one of the papers — the term sheet reflecting the terms and conditions related to the purchase of stocks.
FIB Group Limited, Gambia (“FIB”) is a financial services provider in Liberia, Sierra Leonne, Gambia, DRC and Congo.
SLOK Nigeria Limited (“SLOK”) and International Insurance Company Limited (“IICL”) retained 80% and 20% of FIB’s issued share capital, respectively, prior to the transaction.
Mr Kalu is SLOK Holding’s chairman.
Details of the term sheet showed that Lilium Capital obtained $10 million from SLOK and IICL for the entire issued share capital of FIB.
Similarly, it awarded to SLOK and IICL stocks representing an aggregate of five percent of the company’s issued preferential share capital on the condition that both companies and their owners have no say in the management of the purchased banking unit.
Lilium also suggested making a 5-year annual payment of USD1 million to SLOK and IICL.
The term sheet disclosed that the reorganization detail specified that shares held in each of the insurance subsidiaries in the nations it runs by the banking group would be transferred to a distinct entity that is not component of the business.
The company had insurance subsidiaries in Liberia, Sierra Leone, Gambia and Guinea.
SLOK Nigeria Ltd is part of SLOK Holding, a wholly-owned Nigerian consortium of businesses operating in a wide range of Western African region operations.
The group specializes across different economic industries, concentrating primarily on oil and gas, banking and finance, media and publishing, real estate, manufacturing, trading, insurance, and tourism.
Mr Kalu, SLOK’s chairman, also has investments in other companies, including the Nigerian newspapers Daily Sun and New Telegraph.
Simon Tiemtore, a Burkinabé, is the founder, Chairman and CEO of Lilium Capital, an African strategic investment firm with targeted investment industries in Financial Services, Energy, Hospitality, Agro-processing and FCMG.
After leaving Afreximbank, he established the business, according to African Business Magazine.
It remains immediately unclear why Mr Kalu, a businessman and politician, and other shareholders, sold the bank.
However, details have shown that the decision to sell the banking group may not be unconnected with the “faltering” status of the bank in the countries in which it operates.
Mr Tiemtore gave an insight into this in a 2018 interview with the African Business Magazine.
In response to a question as to why he was attracted to the FIB group, the businessman disclosed that his business looked in the direction of FIB because it fit into a bank’s investment decision “under stress.”
“First of all,” he said in response to the question, “we were not looking for an established bank, we were looking for a bank under stress that we could turn around, restructure and recapitalise.
“That spoke to our strengths. We were looking to recapitalise the bank, strengthening all the different areas that it operates from – credit, operation, recovery, human capital – and give it the bandwidth and the means that it needs to fulfill its mandate in the countries where we operate.”
He has been transforming the bank since then, re-naming it Vista Bank.
Meanwhile, in Nigeria, Mr Kalu and his company, SLOK Nigeria Limited, are being tried in the court of law for an alleged money laundering.
Together with his former Finance Commissioner, Ude Udeogo, and the firm, Slok Nigeria Limited, the former governor is standing trial on an amended 39-count money laundering charge to the tune of N7.6 billion.
The former governor and two others rested their case in the twelve-year-old trial in the last week of August.
Mr Kalu denied accusations that, while at the helm of state affairs between 1999 and 2007, he stole N7.2 billion, stating that at that time the state did not have such funds.
From May 29, 1999 to May 29, 2007, the politician served as Abia State Governor under the platform of the then governing People’s Democratic Party (PDP).
He has since moved to the ruling All Progressive Congress (APC) and is now in the senate representing the Abia North people. He’s the Senate Chief Whip at the moment.