Former Central Bank Governor Nahashon Nyagah has lost two court cases in Mauritius, touching on his stake in the multi-billion Tatu City project.
The rulings reveal a deep split F between Mr Nyagah and his fellow Kenyan shareholders.
The ruling by the Supreme Court of Mauritius delivered on 8 May, touched on internal disputes between the Kenyan shareholders of the project.
Running more than 800 pages, the court papers reveal a battle between Mr Nyagah and Mr Stephen Mwagiru for control of BlackKnight Holdings, an investment company registered in Mauritius, and which holds their shares in Tatu City.
BlackKnight’s other shareholders include Mr Mwagiru’s mother Mrs Rosemary, and Belgian, Mr Etienne Delbar, a former manager of Socfinaf, the company that originally owned the land on which Tatu City stands.
Since 2010, BlackKnight shareholders have been feuding with each other over their minority stake in Tatu City and Kofinaf, the neighbouring coffee estate.
Mr Nyagah and Mr Mwagiru have been unable to agree on the shareholding structure of BlackKnight and financing of its basic operations, such as payments to lawyers, accountants and other consultants, according to court records.
In July and September 2014, BlackKnight issued capital calls to its shareholders for Sh20.4 billion ($200,000M) and Sh15.3Billion ($150,000M) respectively. Mr Nyagah, according to Mauritian court documents, did not contribute his share of these sums, which are considered ordinary for the maintenance of an off-shore company. Instead, he sued his partners. Mauritius is a tax-haven for international businesses.
The deterioration of relations between the shareholders is revealed in a 2010 email from Mr Mwagiru to Mr Nyagah, and which was submitted to the court. In the email, Mr Mwagiru threatened unspecified “embarrassment” and a “bare knuckle” game for management control.
It is estimated that the original Kenyan partners of Tatu City hold about 23 per cent of shares in the project, split among Bidco CEO Vimal Shah, Mr Nyagah, Mr Delbar and Mr Mwagiru and his family.
The majority 77 per cent of shares are held by Mr Stephen Jennings and American and other international investors, who are not a party to the Mauritius dispute.
According to the Mauritian court documents, Mr Nyagah holds a 15 per cent share of BlackKnight, which in turn has a share of another holding company in Tatu City.
Therefore, Mr Nyagah’s overall shareholding in Tatu City is calculated at less than 2 per cent. It is expected that because he has not provided any funding to BlackKnight, the other shareholders will automatically dilute his shareholding further.
Daily Nation
