Billionaire entrepreneur Peter Munga has settled a loan with Jamii Bora Bank, averting the planned auction of his properties worth Sh400 million.
Jamii Bora Bank chief executive Sam Kimani Monday confirmed that Mr Munga had paid the debt, adding that auction of the businessman’s five houses in Kasarani, Nairobi, has consequently been cancelled.
“The debt has been paid in full. The auction will not proceed,” said Mr Kimani, declining to reveal the total amount Mr Munga paid including interest.
Mr Munga, through an aide, told the Business Daily last week that the debt was Sh25 million which the businessman had guaranteed a friend.
Galaxy Auctioneers last week invited those interested in buying Mr Munga’s five units of four-bedroom maisonettes in Kasarani’s Stone Groove Estate to be present at an auction that was to be held at the end of this month.
Galaxy said in the notice that each house has a detached servant quarters.
Bidders would have been required to pay a refundable deposit of Sh500,000 to participate in the auction.
This is the latest in the many battles Mr Munga has fought with creditors — most of them involving his friends and private firms in which he is the controlling shareholder.
Though some of the disputes have been seen to question Mr Munga’s ability to settle debt, the businessman insists he is fending off attempts by dishonest parties to shake him down.
This is because his stake in insurance group Britam alone, for instance, has a market value of more than Sh10 billion — meaning he could easily liquidate part of this wealth to settle debts.
Bankruptcy and failing to pay debt are among the financial misdemeanours that can lock one out of a directorship of a bank or insurer, according to corporate governance guidelines by the Central Bank of Kenya and Insurance Regulatory Authority.