Ver Angola


Court recognizes Sonangol as sole owner of Galp investment. Isabel dos Santos removed

Sonangol was declared the sole owner of the investment in Galp, according to the final sentence of the Dutch court that arbitrated the dispute between the Angolan state-owned oil company and Exem Energy, a company owned by Isabel dos Santos.


The sentence was announced in a statement issued Monday by Sonangol, according to which the court ruled in favor of the Angolan oil company that it will be reinstated as the sole shareholder (100 percent) of Esperaza Holding BV.

This joint venture, in which Sonangol held 60 percent of the shares and Exem the remaining 40 percent, controls 45 percent of Amorim Energia, which in turn is a reference shareholder of Galp.

The dispute was about Exem's 40 percent stake in Esperaza, the vehicle through which the Angolan oil company "made a large and successful investment" in Galp in 2006 and that had been "allegedly transferred by Sonangol," the statement said.

The 40 percent of Esperaza's disputed shares have a current market value of around US$700 million.

According to Sonangol's statement, after analyzing the evidence and after a seven-day evidentiary hearing, "the Arbitration Court concluded that the transaction through which Exem Energy BV intended to acquire its stake in Esperaza Holding BV was contaminated by illegality, allowing its owners [Isabel dos Santos and her husband, Sindika Dokolo, who died in October of last year] to influence the direct control of the national oil company, to reap extraordinary financial advantages in their favor to the detriment of the former and, consequently, the Angolan State.

The court therefore declared the transaction null and void, decreeing that Sonangol be considered the legitimate owner of 100 percent of Esperaza Holdings BV.

Exem was also ordered to bear the legal costs by Sonangol in the course of the arbitration proceedings.

In September of last year, the Dutch arbitration court had already decided to freeze Sindika Dokolo's stake in Exem in the dispute between the businessman and Sonangol.

Sonangol argued that Exem acquired the Esperaza stake on "extremely advantageous terms" by paying 11.3 million euros upfront and the remaining 63.8 million euros through loans financed by the Angolan oil company.

Exem assured, however, that it owed nothing to Sonangol, considering that the investigation opened by the Dutch authorities was welcome and would be an opportunity to "clarify several falsehoods and unfounded allegations.

According to Exem, the inquiry aims to investigate whether there are family relationships that may have influenced the conclusion of contracts, partnerships or business relationships between it or others related to Sindika Dokolo and Sonangol, at the time when Manuel Vicente, former vice president of José Eduardo dos Santos, Isabel dos Santos' father, was chairman of the board of directors of the Angolan oil company.

Exem said it agreed the investment and stake in Galp with Américo Amorim in 2005 and that it paid for its shares in Esperaza, worth approximately 75 million euros, in two installments: 11.5 million euros paid when the contract was signed and 64 million euros plus interest paid in October 2017, in kwanzas, at the exchange rate of the day, "owing nothing to Sonangol for the entry into Esperaza's capital and the latter in Galp.

According to the same source, the payment in kwanzas was made following an agreement between the two shareholders of Esperaza (Exem and Sonangol), to anticipate the payment of the debt to October 2017, since the remaining debt was only due in December 2017.

Isabel dos Santos, who was president of the oil company for about 18 months until she was exonerated by José Eduardo dos Santos' successor, João Lourenço, tried to pay Exem's debt in kwanzas, which was rejected by Sonangol's new president.

Carlos Saturnino "made the return of the values, indicating not to accept kwanzas, and stating he wanted to receive the amount in euros, a statement contrary to the practice of payments received by Sonangol at the time, from other entities," Exem alleges.

The Angolan judicial authorities understood that Esperaza was 100 percent financed by Sonangol, for a total of more than 193 million euros, having lent Exem Energy 75,075,880 euros, amounts not returned to date.

"There was an attempt to pay the debt by the defendants in kwanzas, a fact that was rejected, because the debt was contracted in euros and this clause results from the contract itself," according to the Attorney General's Office (PGR).

The Exem argues, in turn, that having Sonangol agreed to receive payment in kwanzas at the current exchange rate, "the reason for the return of the money was not understood," which led to a dispute between the parties, with arbitration in the Netherlands.

The businesswoman, her husband and the manager and former chairman of the board of directors of Banco de Fomento Angola, Mário Leite Silva, saw their bank accounts and shareholdings in several companies seized in December 2018, by order of the Provincial Court of Luanda.

The measure, according to a statement from the PGR released at the time, came following an action brought by the National Asset Recovery Service.

An investigation by an international consortium of investigative journalists (ICIJ), called Luanda Leaks, revealed, through access to more than 715,000 files, the alleged financial schemes of Isabel dos Santos and Sindika Dokolo, which allowed to take millions of dollars from the Angolan public treasury through tax havens.