[Source: Business Daily, by Galgallo Fayo]
Uchumi Supermarkets revival efforts got a shot in the arm after the High Court dismissed an application by UBA Bank seeking a priority share from the anticipated Sh2.8 billion sale of the retail chain’s prime land in Kasarani.
The claim by UBA Bank, which is one of the Uchumi Supermarkets creditors, was dismissed on the basis that the land is owned by a subsidiary of the retailer that was not party to the court case.
Justice Mary Kasango dismissed the application in which the lender wanted access to proceeds of the sale on grounds that Kasarani Mall Limited is a separate legal entity from Uchumi, which is facing an insolvency petition.
UBA Bank told the court that the troubled retailer has entered into an agreement with Jewel Complex Limited to sell the land for Sh2.8 billion and that a Sh330 million deposit has already been paid.
In her ruling, the judge noted that Kasarani Mall Limited cannot be enjoined in a suit seeking to wind up another separate legal entity unless it is a creditor.
Uchumi, argued that Kasarani Mall Limited is not a debtor in the winding up petition before the court because it is a separate legal entity and that whether or not a sale of one of its assets was disclosed is therefore immaterial.
[Full article on: Business Daily, by Galgallo Fayo]
