A financial advisory and consulting firm, Hydrocarbon Advisors Limited, and Accugas Limited, a subsidiary of Savannah Energy Petroleum Limited, are now in contention over a breach of contract as alleged by the former against the latter.
Hydrocarbon has already gone to the Lagos State High Court asking it to compel Accugas to pay it $1.75 million and N50 million for breach of agreement, for professional services and as general damages.
A statement obtained by BusinessDay in Lagos explained that Hydrocarbon Advisors is the sole claimant while Accugas, which is also a gas development and processing company, is the defendant against whom the reliefs are sought. FBN Capital is a nominal party and was the facility agent.
Hakeem Adedeji, Hydrocarbon’s managing director, explained further that the claimant, through its counsel, Seni Adio, a senior advocate of Nigeria (SAN), filed the November 23 originating summons, praying the court to determine four issues.
“These issues include whether Accugas breached an October 26, 2017 agreement for professional services between Hydrocarbon Advisors and the defendants, together with the change order of November 23, 2018, and e-mail of September 10, 2018 (collectively, the ‘AGREEMENT’) by failing to pay the claimant $1million professional fees plus 7.5 percent value-added tax (VAT),” Adedeji said.
Whether Accugas’ request proscribing Hydrocarbon Advisors from providing professional services to a consortium of financial institutions constitutes an unlawful restraint on trade under the Federal Competition and Consumer Protection Act 2018 and the Local Content Act 2010 and is, therefore, unlawful under Nigerian Law.
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Adedeji noted that, apart from the $1.75 and N50 million for breach of agreement for professional services and as general damages, Hydrocarbon Advisors prayed the court to resolve the issues in its favour and grant it four other orders and reliefs.
The reliefs include an order granting the claimant post-judgment interest on its professional fees and the damages awarded by the court until the judgment sum is fully paid.
A declaratory order that the Accugas’ request proscribing Hydrocarbon Advisors from providing professional services to a consortium of financial institutions constitutes an unlawful restraint on trade under the Federal Competition and Consumer Protection Act 2018, violates the Local Content Act 2010 and is unlawful.
The claimants supported their claim with an affidavit in support of the originating summons sworn by the managing director who is an investment banker.
Adedeji averred that on or about October 26, 2017, the first and 2nd defendants retained the professional expertise of the claimant for the restructuring of certain complex loan facilities in the sum of USD385 million (Three Hundred and Eighty-Five Million United States Dollars) granted by a syndicate of local and international financial institutions to the 1st defendant (the ‘Initial Mandate’).
The claimant provided the required services as contained in the Initial Mandate. Notably, the Initial Mandate provided that “the 1st Defendant will Be Responsible For Payment Of Fees And Other Charges Incurred In Accordance With The Engagement Letter.”
“Based on the Claimant’s performance under the Initial Mandate, the 1st and 2nd Defendants decided to expand the Claimant’s scope of services by activating the “Change Order Process” contained in the Initial Mandate.”
He averred, among others, that the Claimant performed the additional services pursuant to the Change Order including leading the swap negotiations amongst the 1st Defendant, Savannah, and Frontier Oil Limited, with the 2nd Defendant playing the role of Facility Agent, thus culminating in a successful gas-for-oil swap.
He averred that the professional services that the Claimant provided “required ingenuity, were novel, and prevented the total collapse with extensive repercussions concerning an almost $1billion corporate acquisition transaction by Savannah (including the $400million facility owed to the syndicate of local and international banks).”
