Nigerian Bank Moves to Take Over Supermarket Over N871.5m Debt After Taking Over Stallion Group
- United Bank for Africa in Kenya has secured permission to sell a supermarket's land over N871 billion
- A High Court permitted the bank after the defunct company and its management failed to pay the debt
- In Nigeria, the bank took over the assets of Stallion Group, a multinational company with headquarters in Dubai
Pascal Oparada has over a decade of experience covering Tech, Energy, Stocks, Investments, and Economy.
United Bank for Africa (UBA) in Kenya has been granted permission to auction a piece of land belonging to Uchuni Supermarkets on Langata Road, Kenya, over N871.5 million (Ksh 162 million) debt.
A High Court gave the bank permission to sell the land after it emerged that the defunct supermarket and management had yet to pay the debt, three years after reaching a deal on the Company Voluntary Agreement (CVA).
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UBA allowed the auction of a supermarket land
In 2022, UBA Kenya disclosed plans to auction the property after it emerged the government was moving to acquire the land compulsorily, stating that the bank should be paid first after the sale as it has the title to the property as a guarantee.
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The bank, however, renewed plans to auction land and recover its money.
According to Justice Mabeya, three years into the CVA, the debtors have not made any payments, and there was nothing to reflect that non-core assets would be sold and the proceeds channeled towards paying creditors as agreed.
"Only beautiful promises that are made by the company (board). The company must be told that creditors do not live on empty, beautiful promises that are nothing but a bluff! Businesses and the economy are run on cogent and pragmatic proposals that are not only realizable but are practicable and real," the judge said.
The company opposed the application, stating that the matter had been dealt with in an earlier decision and the application dismissed.
Lawrence Ngao said the CVA was still valid and partly revised after meetings with the creditors.
He said UBA was taking 10% of the land, about N871 billion.
There were contentions that the lender did not obtain the consent of other lenders, such as the government seeking about Sh1.2 billion and ICDC Limited (Sh116 million).
Ngao stated that the entire body of creditors had approved the revival of CVA in August this year.
He informed the court that the property is an essential income generator and the success of CVA depends on it, and the agreement proposes to repay the bank's loan in two years instead of recalling the amount immediately.
According to reports, UBA denied knowledge of the meeting as it was not invited to attend and did not recognize the revised CVA.
Court demands documents showing the value of landed properties
Documents shown to the court reveal that the property's open market value as of September 2018 was around Sh600 million and the forced sale value at Sh450 million.
In the CVA, which was adopted on July 1, 2020, the creditors agreed that secured creditors would get a portion of their old debts as an upfront payment pending the completion of the disposal of the non-core assets, with the balance being paid over six years and in other instances over five years,
It further stated that all monetary decrees, debt recovery claims, outstanding loan facilities, and rent claims, including interest and penalties against the company as of March 2, 2020, would be paid in line with CVA.
Per Justice Mabeya, the company has defaulted in implementing the provisions of the CVA as no creditors have received any payment, and the management failed to call for periodic meetings.
UBA takes over Stallion Group's assets
Recall that UBA Nigeria took over the assets of a multinational company, Stallions Group, over unpaid N156 billion.
The bank took over the assets of Stallion Nigeria Limited and its affiliates in Lagos, Port Harcourt, and Kano.
This followed a Federal High Court order in Lagos in an alleged N156 billion debt suit against the company.
A report said the bank's receiver and court bailiffs, accompanied by police officers on Friday, November 10, 2023, executed the orders in three cities.
Justice Akintayo Aluko made the order on October 20, 2023, after hearing Tomilolu Adamolekun, who appeared with Mohammed Usman and moved the motion ex-parte as counsel for the plaintiffs/applicants, supported by an affidavit deposed by Anthony Chilaka in the suit.
The order will subsist pending the hearing and determination of the motion on notice, which the court adjourned till November 20, 2023.
Vanguard reported that the affected assets are at the Trans Amadi Industrial Layout in Port Harcourt, KM17, Lagos Badagry Expressway, Lagos state, and No. 54, Challawa Industrial Estate, Kano state, Nigeria.
Access, Zenith, UBA Lead 10 Banks with highest staff salaries and other personnel expenses in 2023
Legit.ng earlier reported that as banks increased salaries to alleviate the effect of high living standards on their staff, about 10 banks in Nigeria spent N589.88 billion on personnel costs in the first nine months of 2023, representing a 33.2% increase from the N442.97 billion reported in the first nine months of last year.
Access Holdings Pls, Zenith Bank, UBA, Guaranty Trust Bank, and First Bank are the banks.
Others include Fidelity Bank, Wema Bank, Stanbic IBTC, Sterling Financial Holdings, and Unity Bank.
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Source: Legit.ng
