A Federal High Court in Lagos on Monday quashed the Share Purchase Agreement (SPA) which transferred ownership of Nigeria’s flagship magazine, Newswatch, to wealthy businessman, Jimoh Ibrahim.

Two minority shareholders — Nuhu Aruwa and Jubril Aminu — had filed a petition, urging the court to nullify the agreement which transferred ownership of the company to Mr. Ibrahim.

The applicants also sought an order restraining the respondents from publishing and selling to the public, Newswatch daily and weekend magazines.

Respondents in the suit are Newswatch Communications Ltd, Global Media Mirror Ltd, Jimoh Ibrahim, Newswatch Newspapers and the Corporate Affairs Commission.

Delivering judgment in the suit on Monday, Justice Ibrahim Buba, upheld all the prayers of the minority shareholders.

The judge also awarded the sum of N15.7 million as damages against Mr. Ibrahim and also gave an order stopping further publications of Newswatch Daily.

Mr. Ibrahim has been locked in a battle for the magazine’s ownership after its founders purportedly transferred the majority shares to him in 2011.

Newswatch, established 30 years ago, was a household name in Nigeria during the military era particularly in the 80’s and 90’s.

After taking over the brand, Mr. Ibrahim, who also has interests in oil and gas, airline, insurance and other industries fired the founding editors of the paper, Ray Ekpu, Dan Agbese, Yakubu Mohammed and Soji Akinrinade.

He also relocated the head office of the magazine and commenced a daily publication.

The lawsuit challenging his ownership of the paper has lasted since 2012.

One of the minority shareholders, Mr. Buba held that the respondent could not prove that they paid up for the shares as the petitioners gave evidence to show that the second to the third respondents totally failed to pay for the shares of the company.

Mr. Buba said: “They have not shown how and when they paid for the said shares, and nothing in paragraphs 11 and 18a of the respondents’ statement of defence shows how they paid for the shares.

“There is no evidence in paragraph 3 that the respondents paid on or before May 5, 2011 as stated, as they have only given their interpretation to that paragraph.

“Whatever monies they spent was spent on Daily Mirror and this was confirmed by DW2 during cross-examination.

“The N510 million was supposed to be paid for shares and not for any other purpose; there is no evidence to show that the shares have been paid for.

“Besides, it was a company called Global Fleet that paid the N14 million, not any of the respondents who contracted with the first respondent”.

The judge, therefore, held that the case of the petitioners had merits and granted all the reliefs sought.

“The court grants all the reliefs as set out on the petition at the inception of this case.

“An order setting aside the contract entered into between the first and second respondents’ companies by virtue of document titled “Share Purchase Agreement”, between the first and second respondents executed in May 2011.

“A consequential order setting aside the Form CAC2 ( Statement of Share Capital and Return of Allotment of Shares) of the 1st respondent company dated Aug. 27, 2012, and presented for filing by one Gloria A. Ukeje.

“An order directing the 2nd and 3rd respondents jointly and severally to pay special damages in the sum of N15.7 million to the first respondent company being loss of business profits since August 2012 till October 2012 when its operations were unilaterally shut down,” the court held.

The court also held that the petitioners had discharged the burden placed on them by proving their case, while the first to fourth respondents failed woefully to discharge the burden placed on them.

The News Agency of Nigeria (NAN) reports that the petitioners had averred that the 2nd and 3rd respondents purportedly came into majority ownership of the Newswatch Communications by virtue of a Share Purchase Agreement entered into in May 2011.

They averred that by virtue of clause 3 of the said agreement, the 2nd respondents purportedly acquired 51 percent of the company on the condition that they paid the sum of N510 million as price of its shares.

They added that by clause 4 of the agreement, the money was to be paid on or before May 5, 2011, and that the 2nd respondent was obligated to pay additional N500 million within 90 days after takeover.

The amount was supposed to serve as working capital for the company.

The petitioners averred that without complying fully with the aforementioned conditions of agreement, the 2nd respondent through the instrumentality of the 3rd respondent, went ahead and took over full control and management of the first respondent’s company.