The Securities and Exchange Commission (SEC) has directed the Nigerian Stock Exchange (NSE) to suspend trading in the shares of Oando Plc effective from Wednesday.

The suspension which will last till 20 October is a prelude to the technical suspension of the company shares.

A full suspension is the halt of trading activities in a listed security for a period.

A technical suspension is the interruption of price movement in a listed security for a period so that any dealings in the securities which occur during the period of the suspension will not result in any change in price, which change may have occurred had the suspension not been implemented.

Oando has been under the scrutiny of the SEC over allegations about the company’s huge debt and petitions by some shareholders over corporate governance..

One of them was the businessman, Alhaji Dahiru Mangal, who claimed to have 17.9 per cent of the company. Oando claimed he has only 4 per cent and that he is yet to disclose the ownership of the remaining 13.9 per cent in compliance with Section 95 of the Companies and Allied Matters Act, Cap. C20 LFN 2004 (‘CAMA’)

Another petitioner was the Italian businessman, Gabriele Volpi.Volpi who runs the troubled Intels in Nigeria claimed he invested in Oando via his company  Ansbury Inc, by making equity contribution to  Oando’s purchase of ConocoPhillips Nigeria assets.

But Oando shot back that Ansbury  is not a shareholder of the company, but a shareholder in a company domiciled in a jurisdiction outside Nigeria.

Ansbury, Oando said,  holds shares in a Nigerian investment company by the name of Ocean and Oil Development Partners (OODP) that is a shareholder in Oando PLC.

Both petitioners wanted to cash out from the company, but Oando has refused to play ball, because the company is facing a serious financial crisis, occasioned by the big fall in oil prices, soon after it paid $800million to buy ConocoPhillips in Nigeria.

At its 40th shareholders meeting in Uyo last month, the company reported some profitability for 2016. The Oando Group’s financial results showed turnover increasing  by 49 per cent, N569.0 billion compared to N382.0 billion in the corresponding period of 2015.

Profit after tax increased by 107 per cent, N3.5 billion compared to a loss of N47.6 billion in 2015 and net debt reduced by 35 per cent to N230.6 billion compared to N355.4 billion in 2015.

SEC said the commission carried out a comprehensive review of the petitions and found out the company allegedly breached the provisions of the Investments & Securities Act 2007.

It said Oando breached the SEC’s Code of Corporate Governance for Public Companies and was also guilty of suspected insider dealing.

“The Commission’s primary role as apex regulator of the Nigerian Capital Market is to regulate the market and protect the investing public.

“SEC notes that the findings are weighty and need to be further investigated and after due consideration, it is necessary to conduct a forensic audit into the affairs of Oando Plc.

“This is pursuant to the statutory duties of the Commission as provided in the ISA 2017.

“To ensure the independence and transparency of the exercise, the Forensic Audit shall be conducted by a consortium of experts made up of auditors, lawyers, stockbrokers and registrars.

“To further ensure the interest of all shareholders of Oando Plc are preserved during the course of the exercise, SEC directed the NSE to place the shares of Oando Plc on technical suspension,’’ it said.