Court rules in favour of ADB to float shares

The Industrial and Labour Division of the High Court yesterday gave the Agricultural Development Bank (ADB) permission to proceed with its plans to float shares on the Ghana Stock Exchange (GSE).

According to the court, the Union of Industry, Commerce and Finance Workers (UNICOF) had failed to justify why the court should place a perpetual injunction on moves by ADB to float shares on the stock market until the final determination of a legal battle between it and the bank.

Dismissing UNICOF’s application, the court, presided over by Mrs Justice Gifty Agyei Addo, held that the applicants had failed to lay concrete evidence on why the bank’s plans should not materialise.

It further held that it was not convenient for UNICOF to be granted the application and noted that the ADB stood a greater chance of suffering gravely if its Initial Public Offer (IPO) was not allowed to materialise.

“The bank will suffer severe hardship if the application is granted,” the court ruled.

Touching on the applicant’s argument that the bank proceeded to issue the IPO while negotiations for shares to be allotted ADB workers were ongoing, the court submitted that it was on record that the bank gave out the shares out of its own volition.

It also reminded the applicants that the bank, which awarded the five per cent shares on merit to deserving hard-working staff, was not under any obligation to offer more than the five per cent.

“The bank has everything to lose if the IPO fails. There will be no order as to cost,” the court added.

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Counsel for UNICOF, Mr Charles Bawaduah, said his side respected the court’s decision, but had a contrary opinion.

He indicated the preparedness of his clients to appeal the decision at a higher forum.

Background

The court, on July 13, 2015, placed an interim injunction on moves by the ADB to float shares on the stock market but that order was effective for only 10 days.

Moving a motion for the court to dismiss UNICOF’s application for perpetual injunction against the ADB’s IPO, counsel for the bank, Mr Tony Lithur, on July 30, 2015, urged the court to not entertain the suit because it was without merit, baseless and instituted in bad faith.

A date is yet to be fixed for hearing of the substantive case.

Writer’s email: mabel.baneseh@graphic.com.gh.