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21st of January 2018


Supreme Court Dismisses Willmar's Appeal against Sabir

Supreme Court Dismisses Willmar’s Appeal against Sabir

The dispute between Sabir, major shareholder and managing director of AL-SAM Plc, and Wilmar emerged after the two disagreed over the dissolution of their partnership.

Justices at the Federal Supreme Court closed a buyout dispute between Sabir Argaw, a wealthy businessman, and his Singaporean partner, Wilmar.

The Court closed the case today, January 8, 2017, in the presence of representatives of both parties at the Federal Supreme Court, even though Wilmar’s lawyer requested the Court to adjourn the case.

A month ago, the Court ordered Wilmar to issue 370 million Br in security to proceed with its appeal against Sabir, who had partnered with its subsidiaries, Wilmar Edible Oils, Wilmar Europe Holdings and Wilmar Resources. The joint venture was to erect 14 factories with a total investment capital of seven billion Birr, three years ago. It was a high profile event graced with the attendance of Prime Minister Hailemariam Desalegn during the laying of foundation stone in Sebeta town.

The dispute between Sabir, a shareholder and managing director of AL-SAM Plc, and Wilmar emerged after the two disagreed over the dissolution of their partnership.

Although Ernst & Young valued the duo’s company at 4.2 billion Br Wilmar claimed it was inflated asserting that the company is valued at 740 million Br. It notified Sabir through email that it would transfer its share of this amount.

Nonetheless, Wilmar held to transfer the shares setting preconditions. Displeased, Sabir took the case to the Federal High Court last year.

The Court had ruled in Sabir’s favour ordering Wilmar to transfer the shares to the plaintiff. It was then that Wilmar appealed to the Federal Supreme Court Appellate Bench, challenging the jurisdiction of the lower court to review the case.

It had also demanded the suspension of the execution claiming that the lower court had made a factual and legal errors in its judgement that a share transfer can be done through email.

The Appellate Court, which had accepted Wilmar’s appeal, called Sabir to respond to the case where the latter said that the appellant must issue security for cost equal to the valuation by Ernst & Young.

Sabir’s lawyers argued that their client’s partner ought to deposit 2.1 billion Br as security asserting that they do not own any fixed property locally and are based overseas.

Despite Wilmar’s claim that the amount demanded by Sabir was exaggerated and its shares at Repi Detergents & Repi-Wilmar can be considered  as immovable property, the Court had ordered the appellant to deposit nonetheless.

Wilmar, which failed to issue the security, has already taken the case to the Cassation Bench claiming that the Appellant Court made an error while ordering them to issue the security bond as they are the ones who would transfer the shares, further arguing that the amount is exaggerated.

Published on Jan 08,2018 [ Vol 18 ,No 924]

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