AMCON Initiates Bankruptcy Proceedings Against Chairman of Milan Industries Limited Over N42 Billion Debt Default

The Asset Management Corporation of Nigeria (AMCON) has launched bankruptcy proceedings against Rajesh Valecha, the Chairman of Milan Industries Limited, as well as four other directors of the company. This action comes as a result of their alleged failure to repay a N42 billion debt.

The four additional directors named in the ongoing petitions, which are before two judges of the Federal High Court in Lagos, include Ramesh Valechha, Vikram Valechha, Odunlami Bayo, and Akin Femiwa Akinsola.

According to Kunle Ogunba (SAN), the attorney representing the plaintiff, the outstanding debt of N41,511,758,031.14 originated from several loan agreements with Skye Bank (now Polaris Bank) that were taken out by Milan Industries Ltd and Milan Nigeria Ltd between 2010 and 2012. The directors are now being held accountable for this debt.

AMCON stated that the debtor companies used the loan funds primarily for the development of a 361-room hotel located at 52 Kofo Abayomi Street, Victoria Island, Lagos, previously known as Intercontinental Hotel and now known as Lagos Continental Hotel.

The statement from AMCON reads, “The debtors are, as at the instant of this petition, indebted to the creditor (AMCON) to the tune of N41,511,758,031.14, which said sum remains unpaid.

“The creditor, by the provisions of Section 48 of the Asset Management Corporation (Amendment No.2) Act, 2019, is also imbued with the requisite vires to proceed against and recover the indebtedness of the debtor companies by the enforcement of the individual liability(ies) of each shareholder and/or director of the said debtor companies – in the instant case, being Milan Industries Limited, Milan Nigeria Limited, Milan Beverages Limited.”