Over the past couple of weeks, serious drama has been brewing in two major African startups – Cellulant and HealthPlus. The embattled lives of the Nigerian CEOs of these companies have dominated newspaper headlines. Bolaji Akinboro was immersed in a corporate scandal following accounting irregularities, even as HealthPlus’ Bukky George has been fighting tooth and nail to save her seat.
Here’s What Happened in Cellulant and why Akinboro Paid with his Job
In the case of Cellulant, there was a corporate governance lapse which some people have described as an “internal malpractice”. Business Elites Africa understands that accounting irregularities were discovered in the company’s agritech platform “Agrikore, a blockchain-like product line that was financed partly with the $47.5 million Series C funding round the company completed in 2018 from TPG Growth’s Rise Fund.
Cellulant’s Chairman, Dr Sam Kiruthu, recently commented on this development whilst explaining what really happened. He said:
“While conducting a compliance review on the Agrikore platform, we identified certain aspects of the compliance infrastructure and control framework of the platform that have not kept up with the platform’s rapid growth. An investigation revealed that 14 Agrikore employees had inappropriately received funds from Agrikore wallets.
“This has led us to the difficult decision to suspend Agrikore operations while we complete a comprehensive review of all aspects of Agrikore operations. The integrity of the platform is our top priority and we trust that we can count on your patience as we address these issues over the coming weeks.”
Apparently, Akinboro (who co-founded Cellulant in 2004), is the brainchild behind Agrikore. He had also been the one overseeing the project since its launch. Now, because the irregularity occurred under his watch, he had to resign. It is, however, unclear at this point if he left willingly or was forced out.
Meanwhile, the fourteen Agrikore employees that embezzled the company’s money have been sacked. Talk about corporate cleansing!
Meanwhile, Bukky George Said she’s not Going anywhere
Over at HealthPlus, the company’s Founder and CEO, Bukky George, have been busy wrestling some “big money” UK private equity investor who allegedly attempted to snatch her company from her. Now this is an interesting development because just a few years ago, we were all rejoicing with the HealthPlus family after they secured $18 million worth of funding from Alta Semper Capital, the UK-based private equity firm.
What We Know about the HealthPlus Drama
In a surprising move last week, HealthPlus’ board of directors voted to sack Bukky George from her position as CEO. In her place, Chidi Okoro was appointed as the company’s interim Chief Transformation Officer. Shortly afterwards, a detailed statement was issued on the company’s official Instagram page urging customers and stakeholders alike to disregard the news about the CEO’s removal. The statement also alleged an “attempted hostile takeover by foreign private equity firm.”
Without a doubt, the back and forth shocked a lot of Nigerians and generated varied conversations. And then on Monday September 28th, HealthPlus’ board of directors issued a separate statement. See the statement below.
HealthPlus’ Statement Regarding Termination of Bukky George’s Appointment as CEO
The majority of the Board of HealthPlus Limited (“HealthPlus” or “the Company”) on Friday, September 25, 2020, issued an instruction terminating, for cause, the appointment of former CEO Mrs. Bukky George and asking Mr. Chidi Okoro to provide interim leadership for the Company as its new Chief Transformation Officer (“CTO”).
This difficult decision was made in full compliance with Nigerian law and following along and drawn out process of engagement, through which the Board sought to address multiple issues with the way the Company was being managed. Despite a series of significant breaches of the terms of Mrs. George’s engagement as CEO, the Board explored a range of options that would enable her to continue to play an alternate leadership role. It, unfortunately, became clear that an amicable resolution was not going to be possible and that, as the multiple issues persisted, urgent action was required to avoid adverse impact on the entire business, including customers, employees, suppliers, and other key stakeholders.
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.
The decision of Alta Semper Capital (“ASC”) to acquire majority control of HealthPlus in 2018 and its belief in the Company’s potential to become a market leader, not just in Nigeria, but across the continent, is a testament to the strength of the HealthPlus brand. That is why ASC originally invested into the business and that is why they committed to continue to invest, subject to the satisfaction of key performance targets.
Although these targets were never achieved by the former CEO, ASC still sought to provide the business with financial support through growth capital.
Despite a pressing need for cash in the Company over the past year, Mrs. 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.
The original vision of the Company can still be achieved under new leadership and an enhanced management structure, for the benefit of all stakeholders. In decisions like this, the interests of the business and its employees must be put first, and that is what the Board has done. Mrs. George continues to serve on the Board, while Mr. Okoro oversees the day-to-day operations of the Company.
The majority of the Board therefore urges the media and the general public to disregard further communications from any individual or group that are contrary to the aforementioned.
EDITOR’S NOTE: At this point, it is rather unclear which side of this HealthPlus story to believe. Business Elites Africa will continue to stay on this developing story.
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