July 10, 2020
Stallion Group, the large conglomerate with a presence in several
African countries and the United Arab Emirates, is facing the greatest
challenge in its corporate existence as several Nigerian banks seek to
liquidate its assets over mounting unpaid debts.
Founded by the colourful and controversial businessman Sunil Vaswani,
the Stallion Group, which is involved in a range of diverse businesses
spanning food processing, sales of automobiles and manufacturing, has
seen its stock go down since Nigeria’s president Muhammadu Buhari
assumed power in mid-2015.
Prior to this, the fifty-seven year old Mr Vaswani and his brothers
Haresh and Mahesh who also are part of the group’s executive
management, had developed a close friendship with the past
administration of Goodluck Jonathan, an academic from the Southern part
of the country who ensured that Stallion reaped the benefits of its
promoters’ fealty through widely-criticized concessions.
Mr Buhari’s ascendancy to the presidency, fueled by a mantra of change
has led to greater scrutiny of the labyrinthine dealings of the Vaswanis
who have been under countless investigations by several law enforcement
authorities in Nigeria.
In addition to well-publicized investigations by the Economic and
Financial Crimes Commission (EFCC), the Stallion Group has had serious
issues with state and federal tax agencies, the Nigerian Customs Service
and the police against which Stallion’s directors sought a protective
fundamental human rights order in November 2019.
In 2018, the EFCC filed charges against Stallion Motors Limited and its
chief executive Hapreet Singh for allegedly giving a N1.275 billion to
the People’s Democratic Party to finance the 2015 elections and the
inexorable pressure from the anti-graft agency and other quangos has
disrupted the group’s business leading to a rapid downsizing of its
workforce.
Industry watchers say that Stallion’s closeness to senior officials of
the People’s Democratic Party, including Sambo Dasuki, the former
National Security Adviser, who was incarcerated for several years by the
Buhari administration after being accused of diverting billions meant
for security to partisan causes, has effectively placed Stallion and the
Vaswanis on a government blacklist cutting it off from lucrative
contracts that had been a cash cow for the group.
Sensing Stallion’s precarious financial situation, several Nigerian
banks have also gone for the firm’s jugular. In 2019, a Federal High
Court in Lagos granted an order protecting Gbenga Akinde-Peters, a
Receiver/Manager appointed by Guaranty Trust Bank Plc to take over all
fixed and floating assets of Stallion Nigeria Limited company in
receivership,the company owned by the Vaswani brothers, wherever the
assets are found, particularly its registered Head office at 270A, Ajose
Adeogun Street Victoria Island Lagos.
The order of the court was as a result of the company’s inability to
pay a debt of N11,401,860,857.06 and $1,969,801.07. The defendants in
the suit were THP Limited, The Honda Place Limited, Connoisseur
Investment Limited, Premium Seafoods Limited and Onward Fisheries
Nigeria Limited who were alleged to have guaranteed the loan.
In an affidavit sworn to by a litigation officer, Mr Segun
Omoshola,filed and argued before the court by a Lagos lawyer, Temilolu
Adamolekun, the deponent alleged that, Stallion Nigerian Limited
company, in receivership, was availed several loan facilities totaling
the sum of N30.5Billion to augment its working capital needs as well as
those of its related companies.
The loan facilities were drawn down and used by the Stallion Nigeria
Limited Company in accordance with the offer letter.
The loan was secured by the personal guarantee of Mr Sunil Vaswani who
is the alter ego Stallion Nigeria Limited, five choice properties
located in Lagos,Port-Harcourt and Abuja.
However, when the facilities were matured,Stallion Nigeria Limited and
the defendants’ companies who guaranteed the loan failed to liquidate
the facilities which have continued to accrue interest.
GTBank stated that as at March 31,2018, Stallion Nigeria Limited’s
indebtedness to the bank stood at N11,401,860,857.06,and $1,969,801.07.
The bank said it had written several demand letters, made entreaties to
Stallion Nigeria Limited and the defendants companies to meet their
obligations to the bank but Stallion did not provide any meaningful
response.
Justice Saliu Saidu, after hearing Temilolu Adamolekun and four other
senior lawyers, while restraining the Directors of the defendants
companies from obstructing the Receiver/Manager from performing his
duties,also issued an order Protecting Mr Akinde Peters appointed by the
bank to take over all fixed and floating assets of Stallion Nigeria
Limited.
In June 2020, another top-tier Nigerian bank sued Sunil Vaswani over
debts accumulated by Stallion Group, based on the personal guarantee he
provided for the loans. The bank sought a judgement sum of N23, 388,
188, 765.49 from Mr Vaswani being the outstanding debts owned by the
Stallion Group as at May 12, 2020. The bank also asked the court to
compel Mr Vaswani and the Stallion Group to pay the accumulated interest
at a rate determined by the court.
The bank asked the court to transfer Mr Vaswani’s assets to it if the
debts are not paid. The assets which are located across several
jurisdictions including Nigeria, the United Kingdom and the United Arab
Emirates, include: L9, Lailak Street, Emirates Hills, Emirates Living,
40 Avenue Road, NWH 8 6HS.
The bank also asked the court to authorize it to seize all stocks and
equity holdings maintained by Mr Vaswani around the world including cash
deposits, bonds wholly or jointly-held, investments in financial
schemes, all forms of negotiable instruments in commercial banks,
discount houses, mortgage banks, merchant banks and other financial
institutions located within the Federal Republic of Nigeria, the United
States of America, the United Arab Emirates and other countries and
territories.
The bank also applied for an order to seize Mr Vaswani’s funds in
several banks including but not limited to accounts in Rak Bank and
Emirates NBD Bank in the United Arab Emirates, Barclays Bank Canary
Wharf London, HSBC Bank of 8, Canada Square, Canary Wharf London and
Standard Chartered Bank, Basinghall Avenue, London.