American-Nigerian mogul Sam Darwish’s IHS dragged to court by French firm Wendel

Telecom infrastructure giant IHS Holding, led by American-Nigerian mogul Sam Darwish, is currently embroiled in a legal conflict with French investment group Wendel SE. The legal dispute arises from a standoff between the two parties over the management of the firm.

Through its subsidiary Oranje-Nassau Developpement SCA FIAR, Wendel SE, which holds an 18.8-percent stake in IHS, is seeking to compel the tower company to hold a vote on several governance proposals that were not put forward during the June shareholders meeting.

This development has prompted legal action, with a summons issued by the Grand Court of the Cayman Islands on June 30.

According to the court document, Wendel SE alleges that IHS breached section 8 of the shareholders’ agreement by failing to notify all shareholders of the proposed resolutions and failing to present them for a vote at the Annual General Meeting (AGM).

The lawsuit indicates the ongoing conflict between IHS Holding’s management and its major shareholders. This tension stems from the company’s significant decline in value following its initial public offering (IPO) in New York last year.

In an effort to navigate the shareholder confrontations and safeguard its management autonomy, IHS Holding sought advice from JPMorgan Chase & Co approximately three weeks ago.

With MTN Group and Wendel jointly holding around 44.4 percent of IHS, there are concerns that governance changes may open the door for unwelcome acquisitions.

However, Wendel vehemently denies any intention to orchestrate a takeover and accuses IHS Holding’s board and management of employing misdirection tactics.

In the first quarter of 2023, IHS Holding experienced a notable 49.3-percent drop in profit, falling from $15.1 million to $7.66 million.

However, during the same period, the company witnessed a 35.1-percent surge in revenue, climbing from $446.13 million to $602.53 million.

Despite the dip in profits, IHS Holding remains optimistic about achieving its 2023 goals.

Leveraging its extensive tower network and strategic acquisitions, the company continues to play a pivotal role in the global telecom infrastructure landscape.

Under the leadership of Darwish, IHS Holding has also witnessed modest growth.

The company’s total assets have reached $6.49 billion, accompanied by a marginal decrease in retained losses, which now stand at $3.3 billion.