Blow for GT Bank as high court blocks the auction of Jacaranda Hotel

Hon Lady Justice Wilfrida Okwany who has issued an injunction blocking the auction of the Jacaranda Hotel

A Nairobi high court has blocked the imminent sale and auction of the Jacaranda Hotel. The hotel which is part of the vast Njenga Karume estate had been put to auction by Regent Auctioneers who were acting on behalf of GT Bank.

GT Bank are demanding for the repayment of Ksh. 257 million loan which they had advanced to the Jacaranda Hotel. The Bank is hoping to settle the loan from the proceeds of the sale.

Court documents revealed that the loan had been asked and signed for by JR Njenga, Grace Njokie and Meru M’Mukindia who were all directors at the Jacaranda hotel. Currently, Meru M’Mukindia sits in the board of GT Bank as a Non Executive Director having previously served as a director at the Jacaranda Hotel. Further revelations submitted by the GT bank in the court reveal that the Njenga Karume Trustees i.e. Kungu Gatabaki, Henry Waireri and Ngugi waireri signed as the guarantors for the loan.

Nonetheless, the directors of Jacaranda Hotel are relieved after successfully being granted an injunction to block the auction of the Hotel which was scheduled for January 22, 2020. However, the court ordered that the hotel should pay GT Bank Ksh 4.5 million as part repayment of the loan by Friday January 10,2020 failure to which the hotel will still face a public auction come January 22,2020.

Mahakamani news understands that the trustees had already honored part of the loan. However, the cash had not been used to settle the loan as the KRA ordered the GT Bank to redirect the payment to them in order to settle tax burden that the Hotel owed.

Hon lady Justice Wilfrida Okwany gave the direction even as she allowed all parties involved to negotiate a new loan restructuring agreement. 

The judge further stopped any placement of auction advertisement in newspapers pending the negotiations meant to come up with a solution by January 20, 2020.

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