Union Bank In Court Battle With Dangote Over N5 Billion Loan

According to Daily Newswatch, Sani Dangote, younger brother of the richest black man, Aliko Dangote, has been dragged before Justice Okon Abang of a Federal High Court, sitting in Ikoyi, Lagos, over his alleged failure to liquidate about N5 Billion loan he allegedly got from Union Bank Nigeria Plc. 

The bank, in two separate suits against Sani and his companies – Dansa Foods Limited and Bulk Pack Services Limited – wants the judge to issue an injunction restraining all commercial banks in Nigeria from allowing Sani and his companies to withdraw funds from their accounts pending the determination of the suits.
Union Bank, in its suits, insisted that in a bid to evade payment of the loan, Sani has been making frantic efforts to deplete the funds in the accounts of his companies, and that investigation had revealed that the defendants had started diverting the funds to Dubai in United Arab Emirates (UAE), Canada and Switzerland.
The financial institution in its two separate affidavits in support of the suits deposed to by one Olufunmilola Ayoola, an official of the bank, the bank equally alleged that the failure of the defendants to liquidate what it termed the monumental debt had negatively affected the Nigerian economy, a development which the bank claimed necessitated the suits.

Daily Newswatch reported that Ayoola stated further that the bank was having difficulty in extending credit facilities to small scale businesses which in turn would have helped in boosting the nation’s economy and salvage the country from its present malaise of corruption and underdevelopment crisis.

The Union Bank argued further that the funds which Sani and his companies failed to pay were capable of going a long way in impacting positively on the nation’s economy.

Particularly, according to the suit, the bank in September 2008, granted the defendants N5.2 billion, with the breakdown given as follows: N500 million overdraft, N500 million advert loan, $2.5 million equipment lease, $2.5 million sales and lease back and $30 million import finance.

However, Ayoola recalled that when Sani and his companies could not fulfill the promise of paying back the credit facilities from time to time, the bank approved the restructuring of the loan, but that despite that development, Dansa Foods was indebted to the bank to the tune of N4.003 billion as at November 29, 2012.

He added that the loan was later reduced to N3.477 billion, but that despite repeated demands, the defendants failed to liquidate the debt. Bulk Pack, on the other hand, as at date, is indebted to the bank to the tune of N745.145 million.

Source: Nigeria Communications Week