Matiba consents to sale of schools on receivership

Politician Kenneth Matiba will participate in the joint sale of the prestigious Hillcrest Group of Schools he once owned before they were placed under receivership by Barclays Bank over a debt of Sh600 million.

A consent recorded in court by Matiba’s lawyer Gichuki King’ara, George Oraro for Barclays Bank and Kaplan and Stratton Advocates acting for receivers and managers -Kieran Day, recognises the politician as one of the beneficiaries of the sale proceeds.

Hillcrest is one of independent Kenya’s largest family-owned business empires, taken over by Barclays as the creditor and placed the politician-cum-businessman’s high-cost schools under receivership in 2005 over a Sh620 million debt. The schools have a consolidated turn-over of Sh600 million.

On June 29, the parties recorded an out court settlement before Mr Justice Leonard Njagi to mark the six-year-old dispute as settled.

“It is hereby ordered by consent that we undersigned (lawyers) will be grateful if in exercise of the powers conferred upon you by the Order 49 of the Civil Procedure Rules record and mark the suit as settled,” reads the consent which the judge said had been adopted as a court order.

Mr King’ara said the sale was part of the settlement that the Matiba family had agreed to with the bank to recover the debt.

Spreading on a 52-acre plot in the secluded Karen suburb of Nairobi, Hillcrest offers the British education curriculum and was part of Mr Matiba’s education empire that also included Westlands Kindergarten — now used as offices of Alliance Hotels in Nairobi — and Marlborough House Kindergarten in Nairobi’s Westlands — which has been housing the offices of Saba Saba Asili, a political party founded by Mr Matiba.

After losing the control of carbon dioxide manufacturer Carbacid he sold his 22 per cent stake to a private equity firm, Centum Investment, for Sh418 million, the latest joint sale of the schools has seen the Matiba business empire significantly shrink. Barclays had in 2001 unsuccessfully tried to sell Mr Matiba’s five-star hotels that included Jadini, Africana and Safari Beach over a Sh1.8 billion debt, but the process stopped after the family lodged an appeal with Barclays Plc – the mother company of Barclays Kenya Limited even as the matter turned political.

The politician also owns the Naromoru River Lodge. All the prestigious hotels, apart from Naromoru, have been closed and their websites shutdown.

Another of Mr Matiba’s venture, Kalamka Ltd, which owned the People Daily, was last year acquired by Mediamax Ltd, a company linked to the Kenyatta family. Mediamax also acquired the assets of Ms Rose Kimotho’s Kameme FM and K-24 television station.

The former Cabinet minister, who has since faded from public limelight as a result of ill health, established Hillcrest Secondary School in 1974, the same year he snapped another fortune, the Naro Moru River Lodge.

In 1978, he built Africana Sea Lodge in a record six months, making him one of the youngest African millionaires at 46.

Together with his then business partner Stephen Smith, Mr Matiba, while doubling as chairman of East African Breweries, for years built his multi-million shilling fortune around the Hillcrest schools and four prestigious hotels.

The empire, which was principally managed by Mr Smith, Mr Matiba’s son Raymond, and a known hotel industry prodigy, Mr Christopher Modigell, run smoothly and profitably.