Kaluworks Limited, a manufacturing firm that is part of billionaire Manu Chandaria’s Comcraft Group, is facing the auctioneer’s hammer over non-payment of multiple debts worth an estimated Sh6 billion.
Among others, the company owes millions to I&M Bank, NIC Bank and Bank of Baroda loans that are currently not performing. I&M Bank has already published notices for auction of the company's assets.
In November, I&M Bank instructed Nairobi-based Keysian Auctioneers and debt collectors to attach a multimillion property in Nairobi that had been used to guarantee a loan for Kaluworks after the firm failed to honour its obligation to the bank.
“Duly instructed by I&M Bank Limited the chargees to the above named property, (Forest View Flats, Ngara West) we shall sell by way of public auction for the recovery of $527,887 (about Sh53.6 million) and Sh233.9 million as at 25 August 2018, which amount continues to attract interest until payment in full,” says the confidential letter dated November 28, 2018 seen by a local business daily.
This was followed by another notice mid last month for a public auction of separate assets that were also used to secure multi-million Kaluworks loans.
Apart from I&M Bank money troubles, the company also owes hundreds of millions of shillings in a commercial paper whose repayments it has defaulted on.
At a press conference in Nairobi on Thursday, Sanlam Kenya group chief executive Patrick Tumbo listed Kaluworks as one of the defaulters of a commercial paper it invested in.
Sanlam had to write off Sh1.15 billion mainly related to investments in firms that fell into financial distress, pushing it into a shock Sh1.53 billion net loss in the six months ended June.
It seems the banks have now had enough and are now considering a wind up suit against Kaluworks over the hefty debts.
Credit officers from the affected banks who spoke on condition of anonymity because they are not allowed to speak to media said the banks loaned the money to Kaluworks because Mr Chandaria allegedly presented himself as the face of the company.
Mr Chandaria is the chairman of Comcraft Group, a conglomerate with multiple businesses across Africa and beyond of which Kaluworks is a member.
The industrialist is also a long-serving chairman of the Kaluworks board of directors.
However, when reached for comment on Thursday, Mr Chandaria said he had resigned from the Kaluworks board “a few years ago”.
He said he currently “does not have anything to do with the company” and was only linked with the company “through representing foreign firms”.
In 2011, Mr Chandaria made it to the Forbes 40 Richest Africans list and two years later, a US publication, the New World Wealth report, recognised Chandaria for his achievements as an industrialist who had grown the family business to at least 18 countries in Africa.
