Buzeki Enterprises, a transport firm linked with businessman-cum-politician Zedekiah Bundotich Kiprop, owes the country’s third largest bank by assets, NCBA some Sh2.7billion, adding to the debt pile that has left creditors fighting for the Mombasa-based company’s trucks and trailers.
The debt disclosure came in an appeal filed by NCBA which is seeking to block Landmark Port Conveyors Ltd from auctioning 53 trucks and trailers belonging to Buzeki over a Sh118 million loan.
The bank reckons that the 53 trucks and trailers are part of the 289 trucks and 141 trailers bought using the Sh2.7 billion loan.
The High Court last year allowed Landmark to auction the vehicles to recover Sh118 million after Buzeki defaulted on a debt repayment agreement signed in November 2018.
NCBA, however, appealed the High Court decision saying it had a stake in the financing of Buzeki’s 53 trucks and trailers hence their sale by Landmark would dilute the security of the loan owed by the haulage firm.
The bank says it is holding moveable and immoveable properties belonging to Buzeki, including the 53 trucks and trailers, as security for the loan of Sh2.7 billion.
The lender told the court that it had become the owner of the assets and that Landmark had no right over them.
It sought to stop Landmark from selling the 53 trucks and trailers, which have since been attached by Moran Auctioneers.
On Friday, Justices Roselyn Nambuye, Hannah Okwengu and Daniel Musinga said NCBA’s concerns were merited, noting that “If the properties are sold, and the bank succeeds in its appeal, the appeal may be rendered nugatory as the bank will have already lost the securities for the amount loaned to Buzeki,”
The court said the 53 trucks and trailers shall remain under attachment but shall not be sold.
They also directed NCBA to deposit Sh60 million in an interest-earning account within 30 days, failing which Landmark will be free to sell the trucks and trailers.
Mr Bundotich in 2017 unsuccessfully ran for the Uasin Gishu gubernatorial seat as an independent candidate against Governor Jackson Mandago.
He is the founder of Buzeki Group of Companies that specialises in transport and dairy products. The businessman was the owner of Kilifi Gold and Molo Milk. He sold Molo milk to Brookside, owned by the Kenyatta family, to concentrate on the transport business.
The debt dispute stems from a deal in which the haulage firm had entered into a sale agreement with Landmark, a freight and warehousing firm, on August 7, 2015, to purchase two pieces of prime land worth Sh340 million in Mombasa.
Landmark paid Buzeki Enterprises Sh105 million for the deal in which the transport firm was expected to discharge a mortgage accrued in one of the properties after receiving the deposit but failed to do so.
Buzeki later asked Landmark to review the agreement, prompting the latter to demand a refund of its money.
Landmark moved to court and successfully managed to attach the 53 trucks and trailers in contention.
“The process of execution cannot be faulted in the circumstances of this case. I uphold the move by Landmark Port Conveyors Ltd to proceed with the consent order, which is valid and binding on both parties,” Justice Mbogholi Msagha ruled when he granted Landmark the green light to attach Buzeki’s vehicles for sale.