By Megito Audu, Lagos
Mrs.Olubukunola Adewunmi George, Founder & CEO of Health Plus Limited (HealthPlus),
the leading pharmacy chain in Nigeria has fingered billionaire businessman, Leo Stan Ekeh as the brain behind the illegal take-over of her company by Alta Semper Capital LLP (a UK private equity firm).
Leo Stan Ekeh
Mrs.Olubukunola Adewunmi George
In a letter dated Friday, 9 October, 2020, titled ‘HealthPlus Limited; Appeal for Urgent Intervention in Case of Attempted Unlawful Hijack of Business Operations addressed to the former President, Chief Olusegun Obasanjo by George, she appealed to the elderstateman to intervene on the matter and called the Imo State born Billionaire to order.
Narrating her success story, George said she grew HealthPlus from one small 18sqm store in GRA Ikeja in 1999 to 76 stores all over Nigeria in 2018.
She was running a successful business and typical of every business man or woman, there is always the need and desire to expand and the United Kingdom based Alta Semper Capital came on the scene.
Alta Semper Capital LLP (a UK private equity firm) pledged Africa-focused, healthcare-focused, patient and flexible capital to take advantage of the opportunities in the marketplace in order to scale the business. $18million was pledged according to the deal announcement in Bloomberg on 15 March 2018.
The investment into HealthPlus, she noted was to enable the Company to capture the pent-up demand for high-quality yet affordable
medicines, healthcare and beauty supplies; rapidly expanding the Company’s footprint across Nigeria as well as developing a wholesale channel, investing in private label and e-commerce. The agreement stated that
the partnership will be for at least 5 years, and she had a management agreement to be the Managing Director and Chief Executive Officer (MD/CEO) of the company for the same
The 1st tranche of the money, according to her, was for under $10 million and this was paid up by mid-March 2018. The balance was due in 12 months (mid-March 2019). It has been 18 months and the 2nd tranche was never paid up despite dozens of promises by Alta Semper’s directors, Afsane Jetha and Zachary Fond.
“I was forced to put in my life’s savings into HealthPlus 12 months ago to keep the business going, this is separate from the fact that I had put up my home plus my personal guarantees as collateral for the business co-owned with Alta Semper. A very
lopsided relationship indeed!.
“In Q4 2019, six months after the 2nd tranche was due, Alta Semper promised to fund HealthPlus with $2 million, a far cry from the $8 million that was due. The excuse for the grossly inadequate pledge was that their
Investment Committee only approved $2 million with vague reasons. They proposed the inflow should come in as a convertible loan for speed sake as the business was in dire need of capital.
“Careful scrutiny of the convertible loan agreement showed several onerous terms: the loan will be interest free for two months,
with interest rate of 20% per annum kicking in thereafter; collateral was 100% of my shares. I rejected this asking for straight equity. That was when the real intentions of Alta Semper became clear,” she explained in the letter.
George said they were changing critical terms in the original shareholders’ agreement. Negotiations hung. Alta Semper went mute. In May 2020, after 14 months of delayed funding leading to inadequate inventory, dwindling sales, difficulties in meeting stakeholders obligations, eroding market share, eroded value, stressed management team and an attempt to remove her as CEO; she was constrained to file a petition to seek for minority shareholder protection against Alta Semper.
Investigations revealed that the real reason behind Alta Semper’s inability to fund HealthPlus is because of the onerous terms Afsane Jetha signed with her own fund providers – the family office of Ronald Lauder (heir to the Estée Lauder Companies) and the family office of Dick Parsons (an American business executive, former Chairman of Citigroup and former Chairman & CEO of Time Warner, owners of CNN). The plan was for Alta
Semper to raise capital from Development Finance Institutions (DFIs) to swap with the capital from these family offices. Raising these cheaper institutional funds has been difficult to date, causing strangulation of
Alta Semper’s portfolio companies that are due for funding and even delayed salary payments to Alta Semper’s employees.
A reliable source said, “Afsane needs to take responsibility for the terms she signed
with her fund providers and stop allowing her employees and portfolio companies suffer.”
“Instead of owning up to its inability to fund and possibly inviting another investor to come in to dilute the two shareholders, Alta Semper directors resorted to delay tactics over several months. It became clear that Alta Semper wanted to use an established pattern to takeover the business from me. That takeover pattern has been used for several home grown brands as seen recently on Channels News when the Business Founders Coalition spoke out. PE firms pledge an amount, fulfill part, never fulfill the balance and watch the
business go down. Working with local collaborators, they then stand by the door to buy over the carcass of the business for peanuts, then pump in money and grow the business for their benefit, often ruining the
Founders. A classic example was the dispute between Chicken Republic Founder and DPI-LLP (a UK private equity form), whose Co-Founding Partner & CEO, Runa Alam, is a mentor of Afsane Jetha, Managing Partner
& CEO of Alta Semper.
“After the court papers were served to Alta Semper in May 2020, they asked for informal mediation but dragged this without resolution for over three months. The impasse frustrated my nominee director who resigned five weeks ago. On Thursday, 24 September, 2020, the Chairman nominated by Alta Semper resigned
after calling to apologize to her for being unable to find a resolution to the impasse.
“The next day, Friday, 25 September, 2020 without a board meeting (none had held in the last 8 months), Alta Semper directors (Afsane
Jetha and Zachary Fond) issued a press release that a Chidi Okoro had been appointed as Chief Transformation Officer (CTO) although I remain a director and shareholder. This was how Alta Semper attempted
to terminate my management agreement as CEO,” George claimed.
Immediately following the press release, Alta Semper, George allegedly wrote on forged HealthPlus letterheads to the company’s banks, security company, suppliers and the Registrar of the Pharmacists Council of Nigeria, that there has been a change in leadership but all these stakeholders have maintained the status quo because there was neither a board resolution nor approved minutes of board meeting to back Alta Semper’s claims.
Alta Semper also wrote all HODs of the company to attend a meeting that day to meet the new CTO (who had made his way into the HealthPlus boardroom accompanied by the Alta Semper nominated CFO), but all HODs boycotted the meeting.
“Alta Semper’s failure to provide the 2nd tranche has caused the company great travails. The shelves are scanty due to grossly inadequate inventory. We struggle to fulfil customers’ needs. This homegrown brand
known for pharmaceutical excellence has been severely battered. So much value has been eroded. My home, personal guarantees and reputation are all at stake. This is not what the partnership between Alta Semper and HealthPlus was supposed to be about,” George narrated.
Alleged Role Of Leo Stan Ekeh, Chairman Zinox Technologies Limited
George narrated that Leo Stan Ekeh, Chairman of Zinox Technologies Limited and Chairman of Konga had called her to his office about two months ago, telling her to drop the case against Alta Semper.
According to her, Leo Stan Ekeh informed her that he wants to invest $1.5 million into Alta Semper and that Alta Semper’s investors in New York want to invest $10 million in Konga.
Bukky George alleged that the New York investors promised Konga $10 million if Mr Ekeh solves the Alta Semper-HealthPlus problem in Nigeria. She also alleged that it was Ekeh who discovered Chidi Okoro and presented him to Alta Semper as CTO for HealthPlus which was a mastermind attempt take-over of her company.
“I have been told that he master-minded the attempted hostile takeover, causing Alta Semper directors to violate #COVID-19 restrictions rules (they arrived Nigeria on Wednesday, 23 September 2020 and attempted takeover at HealthPlus’ head office the following Friday without observing the required quarantine period); violated immigration regulations (they entered the country with Visa-on-Arrival and should not parade themselves as executive directors; violate corporate governance and Court processes.
While the Alta Semper officers have left the shores of Nigeria, they are still working with local collaborators to bring the operations of HealthPlus to a standstill. They keep emailing the banks, suppliers and other service providers directly and through their lawyers to surrender to their leadership. On Thursday, 9 October 2020, two detectives in the company of a white man (who had come with Alta Semper officers on Friday, 25 September 2020 to take over the company) served me an invitation letter from the Force CID, Abuja. I am
aware that the plan was to take me away to Abuja so they can take-over operations but this plan was foiled.
The urgent appeal
Bukky George therefore appeal to the former President to talk with Mr Ekeh to let Health Plus Limited be.
“I have given my all to this business and it is totally unfair for a fellow Nigerian entrepreneur
to collaborate with callous foreigners to hijack this business in an unlawful manner. I have no plans to surrender my business in this manner
“In addition, on behalf of all Nigerian entrepreneurs, I am appealing that you use your grand influence to catalyze the much needed changes in business financing in Nigeria. Policies need to be developed and laws passed in order to regulate the activities of Private Equity firms in Nigeria, especially the foreign ones.
“Founders and businesses must be protected from pitfalls associated with PE firms. We need to implement learnings from developed and developing countries on financing SMEs in order to scale. We need to better invest the trillions sitting with our PFAs. The terms and conditions for accessing intervention funds from CBN, BOI etc should be re-evaluated. The cash flows of a business should be recognized as an option for collateral
(Grofin, the South African non-bank financial institution operating in Nigeria practices this, they helped HealthPlus scale in the 2008-2009 economic recession). Intentional policies must be put in place for small and medium-sized businesses that employ hundreds and thousands of Nigerians to support their scale up in order to achieve their potential and ultimately enhance our economy,” she said.
When contacted on WhatsApp, the Chairman, Zinox Technologies,Leo Stan Ekeh told The Gazelle News.com that he did not believed that the letter emanated from Mrs. Bukky George
He told this medium that he had to confirm from the former President and will therefore not comment on the matter.
“I do not have a kobo share in HealthPlus and her investors company and not broke,” he responded.
This was his answer when we sought his reaction to the allegation.
It is quite baffling that few days later, Ekeh responded to the allegation through a press statement apparently to preempt the publication of this report.
According to one media outfit refered to as detailed statement from his Senior Special Assistant on Legal Matters, Barrister Reginald Obiakor, Ekeh said concluded that his offence was advising Mrs George to settle her misunderstanding with her investors.
Below is the letter written to Chief Obasanjo by Mrs George