Woes continue to pile on besieged Nakumatt CEO Atul Shah after the High Court in Nairobi gave the green light to a Rwandan lender to recover Ksh99 million from him.
A report from the Business Daily on Monday, February 3, indicates that the lender entered an agreement with Shah that saw him guarantee a loan granted to the retailer's Rwanda branch.
The agreement, as reports indicate, was that he would foot the cost "without complications" in the event that the retail chain defaulted on payment.
The lender accused Shah of refusing to pay back Ksh111.6 million which was granted on January 19, 2018, despite his promise to do so.
Shah, in his pleadings, however, indicated that the bank should wait for the outcome of insolvency proceedings against the retailer in Rwanda.
The High Court in Nairobi was told that a Kigali court had entered a judgment in favour of the lender in April 2019, paving way for the lender to recover Ksh98.88 million.
In addition to the sum, Shah was also required to part with Ksh95,000 as lawyer fees, after a failed appeal increased the sum from the initial Ksh65,000.
Justice David Majanja of the High Court in Nairobi upheld the judgment by the Rwandese commercial court.
He ruled that while he recognised the retailer's insolvency, his hands were tied since Shah had reached an agreement with the lender that he would pay even if insolvency or recovery proceedings had commenced.
The troubled retail chain was liquidated on January 7, 2020, after creditors who include local lenders, creditors and suppliers ruled out its resuscitation owing to its Ksh39 billion debt.
In addition to the liquidation, reports indicated that the creditors had cast sights on some of Shah's lucrative properties to recover the money owed to them.
