- September 13, 2021
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Property mogul Sudhir Ruparelia renames Simbamanyo building
The building, now under the management of Meera Investments Ltd, a real estate firm of his Ruparelia Group houses the Ministry of Labor, Gender and Social Development among other tenants.
Sudhir acquired the building in October 2020 for UGX18.5b from Equity Bank after the previous owner Architect Peter Kamya defaulted on a bank loan.Mr. Kamya also lost Afrique Suites in Mutongo that Equity Bank sold to Luwaluwa Investments.
Last year in October, Equity Bank sold Simbamanyo House to Meera Investments Limited-a company owned by businessman Sudhir.
“We are writing to inform you that Equity Bank Uganda Limited, as mortgagee, has completed the sale of land comprised in LRV 2220 folio 3 plot 2, Lumumba Avenue Simbamanyo House, after a public auction concluded on 8 October 2020 to the best-evaluated bidder M/s Meera Investments Ltd, ” said Sam Kirubi, Equity Bank Uganda Managing Director.
Equity Bank had put Simbamanyo House on auction after its now-former owner Peter Kamya failed to pay a loan he acquired in 2012 to build a Hotel.
According to court documents filed in the Commercial Division of the High Court, on August 20, 2012, Equity Bank Kenya and Equity Bank Uganda entered into a loan agreement in which the two banks agreed to advanced Simbamanyo with $6m.
The loans, which would make up a consolidated sum of $8.10m (Shs29.83b) including interest and operational fees, among others, sought to finance the construction of Afrique Suites Hotel in Mutungo, Luzira northeast of Kampala and facilitate the takeover of a prior facility advanced to Simbamanyo by Shelter Afrique.
The two banks, details indicate, pooled money together with at least $3.5m drawn from Equity Bank Kenya and $2.5m from Equity Bank Uganda.
However, Simbamanyo Estates challenged the outstanding sum, saying it is only aware of $7.19m (Shs26.48b).
Simbamanyo Estates is also accusing Equity Bank Uganda of providing Equity Bank Kenya with an illegal cover to conduct business in Uganda where it has no jurisdiction.
The real estate company wondered how, according to court document, Equity Bank and Bank One, which provided bridge financing of ($10m) were drafted into the loan agreement yet Simbamanyo had never applied for any facility from the two banks later alone own a bank account in any of the said financial institutions.
However, in its defense, Equity indicated that Sambamanyo benefited and was aware of every financial transaction that was advanced to it.
Equity also argued that Bank One, based in Mauritius, was drafted into the transaction on the request of Simbamanyo, which had sought to obtain bridge financing of up to $10m.
Court documents indicated that Simbamanyo Estates had sought to offset the outstanding sum in a November 16, 2017 letter to Mr Kirubi.
In the letter, Simbamanyo, acting through NISK Capital, sought to restructure the loan with a $10m Standby Letter of Credit secured from Bank One.
Therefore, Equity argued Simbamanyo or its agent were fully aware of all transactions and the case it had filed in March was a “guise or scheme” to defer the performance of its financial obligation that it has since defaulted on.
Mr Peter Kamya, acting through Muwema Co Advocates and Solicitors said Equity Bank had breached contractual trust and engaged in unethical and illegal conduct.
In July, 2021, the High Court dismissed with costs an application in which the proprietors of Simbamanyo Estates Limited had sought to halt the transfer of it’s prime properties in Kampala which was meant for Equity Bank Ltd to recover outstanding loans worth $10.8 million (about Shs40 billion).
In her ruling delivered by e-mail on 30 July, Justice Susan Abinyo said Simbamanyo Estates did not present to court acceptable grounds for court’s consideration to halt the orders of the Registrar Commercial Court, issued on February 17, 2021.
The judge also ordered legal costs for bank and three others,Meera Investments Ltd, Luwaluwa Investments Ltd, and the Commissioner Land Registration incurred in the appeal.
An earlier ruling by the High Court had also dismissed issues presented by the proprietors of Simbamanyo Estates, trying to save the estate that was sold to Meera Investments Ltd, through public auction.
Following the ruling, Equity Bank lawyers had to file a bill of costs to be approved by the court.
Justice Abinyo confirmed that stopping the sale would have infringed the Bank’s right to be heard and also inconvenienced those who prepared for the auction which was advertised on September 8 fixing the sale date.
On October 8 this last year, Simbamanyo Estates Limited filed an application seeking for express orders to stay the sale of its properties which took place on the same day.
Court records show that on the same day, the bank sold Simbamanyo building housing among others the ministry of gender on Lumumba Avenue and Afrique Suites Limited, a four-star hotel at Mutungo Hill, Nakawa Division on the same day.
The court decision followed Simbamanyo Estates Limited’s notice of withdrawing the application with no order to costs which Equity Bank lawyers of AF Mpanga conceded to the withdrawal but demanded for the legal costs incurred.
The High Court, Commercial Division has since dismissed pleadings in which the proprietors of Simbamanyo Estates Limited had sought to stop the sale.
In February this year, Court first dismissed the application by the administrators of Simbamanyo Estates Limited in which they wanted the auctioning of its prime properties in Kampala by Equity Bank Ltd to recover an outstanding loan of Shs40.1bn to be halted.
The ruling was made by High Court judge Her Worship, Bucyana Lillian, in the absence of the parties upon application by Co-Counsel for the 2nd defendant (Meera Investments limited).