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The duel for control of multi-billion Tatu City took a new turn last week when the majority shareholders accused directors Nahashon Nyagah and Vimal Shah of obstruction yet they have not injected cash in the project.
New Zealander Stephen Jennings, who represents an international consortium, said he has been financing the project.
“Mr Nyagah and Mr Shah have never invested a shilling in the project at any stage to date. We had pleaded with them to contribute but they declined. We are unable to take them seriously as people who want to invest given these circumstances and especially now that they are inclined to disrupt the project,” Mr Jennings said.
Mr Jennings and his team have helped buy land, pay staff and construction of some infrastructure.
“Every day, when you go to the ground, you see we are building the Kenyan future,” said Mr Jennings.
The multi-billion project has been dogged by controversy since 2010 when minority shareholders Stephen Mwagiru and Rosemary Wanja filed two winding-up petitions seeking to dissolve Tatu City Company and its sister Kofinaf, alleging that majority shareholders had sidelined them.
The case stalled the project until January 2013, when High Court Judge Daniel Musinga ruled that the two were “acting unreasonably” by seeking to wind up the companies to force a buy-out on their terms.
“We are experiencing exactly the same thing today from two directors who are trying to stop the project,” Mr Jennings said.
“Mr Nyagah and Mr Shah are now moving to freeze the operations and the bank accounts of the project. Their obvious aim is to disrupt the project and to stop us from rolling out the infrastructure, paying employees, paying taxes and operating the business. That is terrible and disgraceful behaviour for a so-called partner in our project.”
Last week, Mr Justice Eric Ogola granted orders in an application filed by Nahashon Nyagah, a former Central Bank governor, and businessman Vimal Shah, claiming that Mr Jennings had ousted them from the board in a purge that also saw the exit of other managers. They have accused Mr Jennings and his international investors of selling land meant for the project.
Mr Jennings regretted that though Tatu City was the first of such projects in Africa, similar initiatives started in Ghana, Nigeria, Zambia and Congo have progressed and are currently in their second phase, while the one in Kenya has been stalled by endless squabbles.
“Tatu was the first city we started but now it is lagging behind. If supported, Kenya which is quickly modernising and desperately needs such investments, can stand on its feet due to enhanced economic growth,” Mr Jennings said.
Mr Pius Mbugua Ngugi, who was appointed chairman of the board of directors of Tatu City Ltd, said the challenges facing the project could have been ignited by the competition that is determined to bring the ambitious project down.
“I can only assume that Mr Nyagah and Mr Bhimji (Vimal Shah) could unknowingly be playing along the wishes of our competitors.
Had they also been serious enough or invested anything, they could have been cautious not to engage in doing anything that could make them lose money. Since they invested nothing, they have found it easy to do anything,” said Mr Mbugua.
Mr Jenning’s team would be seeking additional capital to keep construction works moving after the court issued orders last week stopping them from accessing the bank accounts.
“We have employees, contractors and land tax costs to be paid and all these cost millions. We therefore have no option but to source for capital and continue funding the project. The losses we may suffer if we stall the project are enormous,” Mr Jennings said.
Set to sit on 2,400 acres, Tatu City is expected to accommodate 70,000 residents in houses and offices. It is also expected to host 30,000 visitors daily, according to its planners.
The multi-billion project targets residents, companies and retailers who wish to live and work in “the modern, well-planned urban development in East Africa.”
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