according to the Herald. The Federal High Court of Ikoi, Lagos will hear a case against its plan to sell shares to China Huaxin Cement Co., Ltd. (Huaxin Cement Limited) on Wednesday, June 11. Previously, the court denied the defendant's motion challenging its jurisdiction, clearing the way for the substantive trial of the case. The core of the
dispute is the dispute
between secret transactions and minority shareholders'rights and interests. The plaintiff is Nigeria Strategic Consulting Co., Ltd. (Strategic Consultancy Limited), as a shareholder of Lafarge Africa. The company accused Holcim of selling its 83.81% majority stake "in secret" and failing to offer pre-emption rights to local shareholders, including itself. Strategic Consulting believes that the transaction violates the Nigerian Companies and Related Affairs Act (CAMA 2020), the Securities and Exchange Commission Act and the Nigerian Investment Promotion Commission Act (NIPC Act), involves illegal transactions with foreign entities not registered in Nigeria, and damages the rights and interests of minority shareholders.
Transaction Background and Progress
of Legal Proceedings Lafarge Africa is listed on the Nigerian Stock Exchange and is majority-owned by Holcim Group, a Swiss multinational. The company acquired three state-owned cement factories in the privatization process of the Nigerian government from 2001 to 2002, and became the leading enterprise in the local cement market. Holcim Group had previously informed the Nigerian Securities and Exchange Commission (SEC) that it was undergoing an internal restructuring, but the strategic consulting firm said the equity transfer plan was not open and transparent.
During a pre-trial hearing on 15 May, Judge Lewis Alagoa (Justice Lewis Allagoa) rejected the preliminary objections of Lafarge and Holcim to the jurisdiction of the court. On behalf of the plaintiff, Senior Counsel D. A. Awosika pointed out that the defendant was trying to avoid substantive review through procedural barriers. At the same time, the court ruled that Caricement BV of the Netherlands and Allied International Cement Co., Ltd. of the United Kingdom were listed as the fifth and sixth defendants, confirmed that they were the actual holders of the relevant shares, and approved the service of legal documents abroad.
The lawsuit involves the legality of the multi-billion-dollar transaction, and the core disputes include:
whether the equity transfer complies with Nigeria's foreign investment access and corporate governance regulations;
whether the minority shareholders are deprived of their legal rights; and whether the shareholders are deprived of their legal rights; Compliance of the
offshore entity in the transaction.
The analysis points out that if the court finds the transaction illegal, it may have a far-reaching impact on the regulation of foreign mergers and acquisitions in Nigeria, especially the equity changes involving strategic industries (such as building materials and energy). In addition, the case has also attracted the attention of the Nigerian Senate, which has summoned Lafarge Africa on national security concerns and urged the Nigerian Investment Promotion Commission (NIPC) and the SEC to intervene in the investigation.
As the court confirms its jurisdiction and expands the scope of the defendant, the trial on November 11 will focus on the debate on the legitimacy of the trading entity. Lafarge Africa has not yet commented on the substance of the case, but market participants pointed out that if the transaction is blocked, it may affect Holcim Group's global asset restructuring plan.
With the confirmation of the court's jurisdiction and the expansion of the list of defendants, the trial over the legality of the multi-billion-dollar transaction and whether the rights of minority shareholders were ignored will soon begin, and the eyes of the global cement industry will be focused on it. At the same time, the regulatory demands of Nigerian local enterprises on the equity changes of multinational corporations have also attracted wide attention, and this case may become a landmark case of Nigeria's foreign investment policy.
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