A parliamentary committee has recommended that the Treasury compulsorily acquire Uchumi Supermarkets land on Langata Road worth an estimated Sh2 billion and pay off UBA Bank debt of Sh162 million.
The National Assembly’s Finance and National Planning Committee has directed that the Treasury undertake a fresh valuation to ascertain the worth of the land.
“The committee directed the National Treasury to hold a tripartite meeting with the office Attorney General, UBA Bank and management of Uchumi PLC and report back to the committee within 30 days,” Kuria Kimani, who chairs the committee said in a report to the House.
“The discussion should centre at securing the said property and protecting the public asset, undertake proper valuation of the land to ascertain the actual value of the land and explore the possibility of compulsory acquisition of the land for use by the government and pay off UBA Bank loan of Sh162 million.”
Mr Kimani was responding to a statement sought by Soy MP David Kiplagat on the impending auction of Uchumi Supermarkets' land on Langata Road in Nairobi over the Sh162 million debt.
The committee last week directed the Treasury Principal Secretary Chris Kiptoo to meet with UBA Bank, the Kenya Development Corporation, and creditors to find a way forward on how to save the property from the auctioneer’s hammer.
The committee’s recommendation came soon after UBA Bank was allowed to auction the land by the High Court.
Last year, the lender had dropped plans to auction the property after it emerged that the government was planning to compulsorily acquire the land and UBA would first be paid, after the sale as it holds the title to the property as security.
This, however, did not happen and the lender revived the application to auction the land to recover its money.
Justice Mabeya said three years later, not a penny had been paid to any of the creditors and there was nothing to show that non-core assets would be sold and the proceeds be applied towards paying the creditors as agreed.
The judge added there was no mention of any collection of a penny or otherwise. “Only beautiful promises that are made by the company (board). The company needs to be told that creditors do not live on empty beautiful promises that turn out to be nothing but a bluff!” the judge said.