Recently, a shocking story came out to public knowledge about how Keystone Bank and 9Mobile were acquired in controversial circumstances by the business interests of one Alhaji Isa Funtua, a close friend of President Muhammadu Buhari, via the instrumentality of Asset Management Corporation of Nigeria (AMCON). As the smoke raised by the scandalous story is still swirling in the air, with some public groups challenging the government to come out clean on what could be a serious dent on its anti-corruption stance, there is indeed no smoke without fire. For starters, it is a confirmed fact that the son-in-law of Isa Funtua, Ahmed Kuru, is the current CEO of AMCON. Before him, the previous CEO, Chike Obi, was a first-class gentleman and technocrat who was strangely removed from office before the expiration of his term and was replaced with Kuru, the son-in-law of Isa Funtua.
Now, let us get into the insider details of how Funtua bought Keystone Bank and 9Mobile in the most bizarre of dealings that circumvent the laws of the land. Keystone Bank was sold by the current CEO of AMCON to his father-in-law, Funtua, without any AMCON Board’s approval and with the active connivance of CBN and NDIC at a grossly undervalued price of 25 Billion Naira. To put things in context, let us recall that Enterprise Bank was sold for over 60 Billion Naira and Mainstreet Bank was sold for over 100 Billion Naira under the former CEO of AMCON.
Before the sale of Keystone Bank to Isa Funtua, all bad debts in the books of the Bank were taken over by AMCON. So, it was a clean Bank with all the Assets and no Liabilities that was sold to the Buyers. The Executive Management of AMCON was coerced into approving the transaction and those who were willing to submit a much higher bid were disqualified under a most opaque, suspicious process that lacks all transparency. The process was just manipulated in favour of the father-in-law of the AMCON CEO.
The Corrupt Payment for Keystone Bank
The most disgusting part of the entire sale of Keystone Bank is how the 25 Billion Naira sales price was paid to AMCON. The Isa Funtua Team paid 5 Billion Naira to AMCON, and then the balance of 20 Billion Naira was later paid through the most criminal and corrupt approach ever perpetrated by AMCON in favour of the Buyer. What happened was that AMCON moved 20 Billion Naira of their own funds as a fixed deposit at GTBank to Heritage Bank. Heritage Bank then paid the 20 Billion Naira on behalf of the Funtua Group to AMCON. In other words, AMCON used their own funds as a collateral for a loan to the Funtua Group for 20 Billion Naira!
When the Funtua Group took over Keystone Bank, they went borrowing immediately at the Interbank Market for 20 Billion Naira to refund AMCON’s funds. This has left a hole in Keystone Bank’s Balance Sheet and makes the Bank one of the most undercapitalized Banks in the Country as at today.
The evidence of this highly compromised acquisition process can be obtained from the current and former staff of AMCON, from NDIC, CBN and from the current staff of Keystone Bank itself. The story has been all over the place and it is quite shocking that some political parties and public interest groups are just picking it up now.
The Unholy Sale of 9-Mobile
Another suspicious acquisition scandal surrounding the Funtua Group is about the untidy way 9-Mobile, formerly known as Etisalat, was bought. It is Mr. Adrian Wood of Teleology Holdings, a very sound telecoms professional, who collaborated with the Funtua Group for the acquisition of 9-Mobile. The problem with their bid was the lack of a qualified Operator to support the bid which was one of the minimum conditions of NCC. Adrian Wood alone was not a substitute for an Operator.
The Nigerian Communications Commission (NCC) gave several conditions that must be met by the Ultimate Buyer of 9-Mobile to ensure the protection of shareholders value, prevent loss of jobs, protect the telecoms industry from slipping into a crisis and ensure transparency and professionalism in the post-acquisition entity.
The conditions listed by NCC that must be met by the Buyer are Strong Telecoms Operating Experience, Strong Financial Capabilities, Strong Technical Knowledge and Strong Administrative Skills.
The first thing that happened once Teleology was announced as the preferred winner was that the Funtua Group edged Adrian Woods out of Management and turned him to an Insignificant Shareholder. The second development was that the Funtua Group raided Keystone Bank again and forced the Bank to Pay 50 million Dollars as down payment for the acquisition of 9-Mobile. The third issue was that Teleology Nigeria replaced Teleology Holdings to remove any influence of Adrian Woods from 9-Mobile totally. The fourth step taken the Funtua Group was to borrow 260 Million Dollars from African Exim Bank. The fifth thing was to coerce NCC to approve the sale at all cost without meeting 90% of the conditions set up ab-initio by the NCC. The sixth strange action of the Funtua Group was to force the board of NCC to approve the sale through the influence and pressure from the Presidency. And the seventh Funtua infraction was to use the influence of CBN to force the Banks to the table and waive their own conditions of sale of 9-Mobile to the Teleology Nigeria group.
So far, the problem with the sales of the above mentioned assets is that all the processes and conditions were brazenly circumvented and Keystone Bank was forced into a deeper pit by the greed and recklessness of the Funtua group.
Today, AMCON as presently constituted is just a tool in the hands of the Funtua Group to acquire peoples’ businesses without paying for it or using AMCON’s money to pay for the Funtua Group. Even indigenous airlines like Arik and Aero Contractors, like many other companies under AMCON, are being considered for nepotistic acquisition in the near future. Of course, the Funtua Group has been penciled down as the preferred bidders. The devious plot is that if the Buhari government secures a second term and starts the tenure, all other companies under AMCON will be sold by hook or crook to the favoured Funtua Group. Meanwhile, the Management and Staff of AMCON along with the Board have all been intimidated into silence. In fact, the Board is dead and ineffective. And the other Supervisory Bodies over AMCON are just rubber stamps because the fear of Katsina power brokers is the beginning of wisdom.