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January 16, 2019

Karuturi owners sue to stop Stanbic from selling assets

Workers demonstrate yesterday on Moi South Lake Road / GEORGE MURAGE
Workers demonstrate yesterday on Moi South Lake Road / GEORGE MURAGE

The owners of troubled Karuturi flower farm in Naivasha have now moved to court to stop the receiver manager from selling part of the company’s assets.

This came as over 3,000 former workers held demonstrations to protest the move to sell the assets without first paying their dues.

In a statement by farm executive director Yeshoda Karuturi, the firm had filed a contempt of court case against Stanbic bank for initiating an expression of interest process for the company’s assets.

She accused the bank of irregularly demanding $24m (Sh2,410,068,000 ) from the farm which amounts to 600 per cent of the loan advanced.

“Karuturi has made the public intent to repay CFC’s original debt of $4.04 million (Sh405,591,760 ) plus interest of up to 100 per cent of principal,” she said yesterday.

Yeshoda said the receiver managers had advertised the sale of the assets despite there being an appeal against the decision of the High Court made on January 19.

“We have sought a stay of execution and enforcement of the aforesaid decision pending hearing and determination before the honorable court,” she said.

Stanbic’s advert invited interested bidders to submit their offers before close of business yesterday.

Karuturi’s owners have now obtained a new hearing date at the Court of Appeal – June 14 – as they fight the sale of their land valued at over Sh10 billion.

Stanbic placed Karuturi under receivership in February 2014, after the firm failed to repay a $4 million (Sh400 million) loan.

The land hosts a flower farm, hospital, schools and other amenities.


She said they continued to be subjudice and any sale would be in contradiction to judicial proceedings.

Yeshoda said the owners would fight to protect their assets.

The Naivasha farm is estimated to produce over 330 million roses annually for export to Europe, accounting for about 10 per cent of Kenya’s exports of cut flowers.

Kenya Plantations and Agriculture Workers Union branch secretary in Naivasha Ferdinand Juma said the group is opposed to the move to sell the farm’s assets.

He said the receiver manager was keen to recoup its dues, but had forgotten the workers who were owed millions of shillings by the investor.

“We shall in every possible way reject plans to sell some of the assets as planned by the receiver manager as this means the workers will not receive their benefits,” Juma said.

In an advert last month, the managers said the close to 308 acres where the company sits would not be sold.

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