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   Market Date: 24-04-2014   
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Bank (Guaranty) wants Virgin Nigeria changed to Nigerian Eagle

Category: Frauds & Scandals


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Bank (Guaranty) wants Virgin Nigeria changed to Nigerian Eagle


A commercial bank, Guaranty Trust Bank Plc, has filed an application before a Federal High Court in Lagos, asking it to change the name of Virgin Nigeria Airways to Nigerian Eagle Airlines Limited.


The bank added that the change of name would be in line with the new name of the airline as against the name (Virgin Nigeria) in the charge sheet before the court.


The bank had earlier filed a winding up petition against Virgin Nigeria, following the alleged inability of the airline to service a loan facility of $9. 19m secured from the bank.


In the petition before Justice Dan Abutu, the bank is urging the court to wind up the affairs of the airline under the provisions of Sections 409 (1) and 410 (1) (b) of the Companies and Allied Matters Act.


In the application dated October 6 and filed by the law firm of Kunle Ogunba, the bank claimed that the defendant changed its name without the knowledge of the bank, adding that such a development would have negative impact on any pronouncement of the court on the matter.


The bank had in a substantive suit, alleged that on April 22, 2008 , two loan facilities were granted to the respondents, which were meant for the finance of working capital and issuance of bank guarantee for the supply of spare parts.


The petitioner added that by another offer letter dated May 8, 2008 , the respondent was availed three loan facilities of $30m, $10m and N500m.


The three loan facilities were said to be meant for the purpose of financing working capital, issuance of bank guarantee for spare parts and aircraft payment to suppliers and to finance Virgin Nigeria‘s working capital and issuance of bank guarantee to its suppliers.


But the petitioner alleged that out of the total facilities granted to the defendant, a cumulative sum of $15m was disbursed to the defendant, adding that the respondent failed and refused to reciprocate the good gesture by liquidating the debt.


The petitioner further contended that it had written several letters to the airline on the consequences of its constant breach of the agreement, all to no avail.


It added that Virgin Nigeria was insolvent, adding that it would be in the interest of justice for the company to be wound up over its inability to pay the debt.


The petitioner is therefore seeking an order of the court to appoint a proper and credible person as provisional liquidator to take custody of all identified and traceable assets, properties, funds in banks and other financial institutions, aircraft and other assets of Virgin Nigeria both within and outside the country, pending the hearing and final determination of the petition for winding up.


GTB also sought an order of interlocutory injunction restraining the respondent and its agents from operating, withdrawing from or otherwise tampering with the respondent‘s funds under whatsoever name or guise in any bank or financial institution within Nigeria pending the hearing and final determination of the petition.


The case has been adjourned till November 19.


(Source:Punch)



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