Standard Chartered Bank of Kenya has received the greenlight to auction 22 parcels of land belonging to companies owned by tycoon Diamond Hasham Lalji over debts amounting to Sh1.4 billion.
The High Court last week turned down the application by Premier Flour Mills Ltd, Premier Cookies Ltd and Trident Insurance Company‑ all co-owned by Mr Lalji‑ to stop Stanchart from selling the properties located in Lukenya area, Machakos County.
The court said the application lacks merit since the three companies failed to repay sums that fell due in 2015 despite being reminded to do so.
“Right from the time the demands were made up to the issuance of the various statutory notices, the plaintiffs have not made any single payment even on a without prejudice basis,” Justice D K Kemei said.
The court turned down prayers by the firms to stop sale of the land on basis of possible undervaluation saying the law allows for remedies should this be established at a later stage.
The companies had argued that the said parcels of land were given a market value of about Sh1.3 billion and a force sale value of Sh1.08 billion in a 2015 valuation.
“It was very clear in the loan agreement that in the event of default the said properties would be sold,” the court said.
“The plaintiff’s claim that they are likely to be thrown under the bus by the actions of the defendant can be taken care of by way of damages.”