Former CBK boss, Vimal get reprieve in Tatu City dispute


Bidco director Vimal Shah (centre) with IFC manufacturing, agribusiness and services regional industry head, sub-Saharan Africa German Vegarra and Tatu City chairman Nahashon Nyagah (right) at the Serena Hotel in Nairobi on July 17. PHOTO | DIANA NGILA

Former Central Bank of Kenya governor Nahashon Nyagah and businessman Vimal Shah have obtained a court order reinstating them to the Tatu City board.

This is after they filed a case challenging their ouster by Russian-based majority shareholders of the multi-billion shilling commercial and real estate project.

The duo will hold their positions until the case is determined.

Mr Nyagah is expected to retain his position as chairman of the Tatu City Ltd board of directors, replacing Pius Mbugua Ngugi who had been appointed to the post by the Russian-based shareholders.

Justice Eric Ogola on Tuesday granted the orders in an application filed by Mr Nyagah and Mr Shah, claiming that their foreign counterparts, Mr Stephen Jennings and Mr Hans Jochum Horn, had ousted them from the board in a purge that also saw the exit of other managers.

Mr Jennings and Mr Jochum, had allegedly replaced Mr Nyagah and Mr Shah following a resolution made early this month.

“Pending the hearing and determination of this application, this suit or further orders, the defendants whether by themselves, agents or servants, are hereby restrained from acting upon the resolution made on February 5, to replace the said directors and managers,” said Mr Justice Ogola.

Tatu City was originally marketed as a project backed by Russian-based Renaissance Capital, but was later spun off following shareholding changes at the investment bank.

The foreign partners were also stopped from taking or making decisions, giving instructions or writing letters on behalf of Tatu City or its sister firm, Kofinaf Company Ltd, without the consent of local partners and directors, Mr Nyagah and Mr Bhimji.

READ: Court battle as Nyagah, Vimal unseated at Tatu City

The defendants were equally barred from accessing and operating Tatu City’s bank accounts until the case is concluded.

Mr Nyagah had in the application said the actions by their foreign counterparts were calculated to give them exclusive control over affairs of Tatu City and Kofinaf, a coffee firm on whose land the project sits, so that they may continue pilfering the capital and income of the company and its assets.

“There is real danger that such actions will leave the company exposed because the properties of Tatu City Ltd and Kofinaf Company Ltd would have been sold, the proceeds siphoned out of the country and beyond reach because they are not Kenyan nationals and cannot be readily available to account should the project stall or fall,” said the former CBK governor in his court submissions.

The Tatu City project targets residents, companies and retailers who wish to live and work in “the modern, well-planned urban development in East Africa” and is to be built on 2,400 acres.

Upon completion, it is expected to accommodate 70,000 residents and handle 30,000 visitors daily, according to its planners.

The court also stopped the appointments of Mr Ngugi and Frank Mosier as directors of Tatu City Ltd.

The Russian-based partners had also terminated the employment contract of Tatu City chief executive Lucas Akunga Omariba, and replaced him with Anthony Njoroge in an acting capacity.

Equally, they sacked John Ngahu and Elizabeth Ndichu as employees of Tatu City, and removed Mr Akunga, Mr Ngahu and Mr Nyagah as signatories to Tatu City Ltd’s accounts replacing them with Mr Anthony Njoroge and Mr Christopher Barron.

The case will be heard on March 3.