HealthPlus: How Alta Semper's Corporate Code Mistake Could Undo Bukky George's Sack

Alta Semper has defended its decision to takeover HealthPlus by 'sacking' the founder of the Pharmaceutical company, Bukky George. AllNews had reported that Alta Semper appointed Chidi Okoro to replace George as the Chief Transformation Officer.

Alta Semper said before the appointment of Okoro, the Private Equity firm explored several options to ensure George remained in a leadership position. Alta Semper said it decision to relieve George of her Chief Executive Officer position and appoint Okoro was due to her performance which didn't meet target.

Note that Alta Semper is the majority shareholder in HealthPlus. George had approached the private equity firm for funds in exchange for a majority share as she eyed expansion of HealthPlus. The deal between HealthPlus and Alta Semper is expected to last for five years; 2018 to 2022, after which Alta Semper will exit HealthPlus.

READ ALSO: Discos Confused As FG Undecided Over Tariff Suspension

What Does Alta Semper Have Against George?

Alta Semper said George hasn't performed to expectations and she has refused to receive funds from the funder that is on 'commercially reasonable terms'. She was also accused to have breached terms of her engagement as HealthPlus CEO.

Aside from the aforementioned complaints, in a statement issued by Alta Semper, George reportedly tried to force Alta Semper to restructure the 2018 agreements. The foreign funder said it had no choice but to move to replace George in order to prevent a negative impact on HealthPlus operation.

“Despite a series of significant breaches of the terms of George’s engagement as CEO, the board explored a range of options that would enable her to continue to play an alternate leadership role." the statement reads.

“Despite a pressing need for cash in the company over the past year, George has not only refused to agree to offers of additional investment on commercially reasonable terms but attempted to force ASC to restructure the existing binding contracts governing their relationship – agreements, which she readily signed in 2018 after taking independent legal and financial advice.” Alta Semper stated.

AllNews had previously reported that George accused Alta Semper of refusing to provide needed fund for the company's operations as agreed in the 2018 deal.

Who Are The Board Behind Alta Semper Decision?

According to Alta Semper in the statement, the majority of the board of directors supported the decision for leadership change, “As a result, the majority of the board of directors of the company determined that a change of leadership was required if HealthPlus was to achieve its strategic goals and the former CEO’s appointment was terminated in accordance with its terms.”

READ ALSO: CBN In Policy Dilemma As It Turn To Development Finance Ahead Of Recession

However, this majority are members of Alta Semper, as two other board members; chairman of HealthPlus, Ayo Salami and Deji Akinyanju, had resigned from the board without being replaced - so the board consist of Afsane Jetha and Zachary Fond.

Jetha and Fond have been representing the interest of Alta Semper on the board of HealthPlus since the deal of March 2018. Jetha is the Managing Partner and Chief Executive Officer of Alta Semper, while Fond is the Managing Director of Alta Semper.

HealthPlus has five board members, two from Alta Semper and three other Nigerians, this is according to HealthPlus corporate code, "The Company has a five (5) member Board comprising two (2) nominees of the foreign investor, two (2) nominees of Mrs. Olubukunola George (including herself) and a mutually appointed Chairman.

But Salami and Akinyanju resigned before the removal of George by Alta Semper - this leaves only three members of the board; Jetha, Fond and George - So the majority of the board cited by Alta Semper was Jetha and Fond, who are representIves of Alta Semper.

How HealthPlus Code of Operation Invalidate Alta Semper Decision

According to HealthPlus' corporate code item 50 of Schedule 9, the decision to appoint or remove a key employee must be approved by the entire board. A board meeting must be held, however, AllNews gathered that Alta Semper's representatives didn't call for such.

With the failure to appoint replacement for Salami and Akinyanju, Alta Semper's decision is invalid and breaches the guidelines of HealthPlus operation. While countering the claim of Alta Semper that majority of HealthPlus board are in support of their leadership change decision, HealthPlus lawyers said two members don't represent majority.

In a letter addressed to Jetha and Fond on Monday, September 28, 2020, HealthPlus lawyers said, “George is entitled to nominate a replacement for Akinyanju and the shareholders are required to agree on a replacement for Salami, in order to properly reconstitute the board.

“No steps, whatsoever, have been taken in this regard, and it is, therefore, improper to refer to ‘a board’ when what the company has at present is depleted or improperly constituted board." The lawyer said, adding that this makes the termination of George’s role as CEO invalid.

Court Issue Between George, HealthPlus And Alta Semper

AllNews reported that George filed a lawsuit against Alta Semper in Nigeria court to prevent the investor from making any decision that affects the interest of George and HealthPlus, but the UK funder frustrated the process after appealing for outside court settlement. While addressing its court case with George and HealthPlus, Alta Semper said it complied with the law of Nigeria.

“This difficult decision was made in full compliance with Nigerian law and following a long and drawn-out process of engagement, through which the board sought to address multiple issues with the way the company was being managed,” Alta Semper said on Monday.

However, George had stated that after Alta Semper appealed for mediation, the foreign company frustrated the three meetings they had, dragging the mediation process for three months without conclusion. Despite seeking out of court settlement, Alta Semper went ahead to file a case against George at a UK arbitration court.

Note that aside from trying to unseat George, Alta Semper had also tried to takeover the bank accounts of HealthPlus, by requesting the bank change the signatories to the company accounts. The bank turndown the request as Alta Semper didn't have board approval or resolution to make the changes, neither did Alta Semper tender approved minutes of the board meeting.