(Posted 26th September 2023)
The Pearl of Africa Hotel, a rather sad example of how best not to run a hotel, will according to a public notice issued by court bailiffs, government auctioneers and debt collectors Armstrong Limited be auctioned off over an outstanding debt of over 611 billion Uganda Shillings. Armstrong acted on behalf and on instruction of MMAKS Advocates and ENSafaris Advocates who represent debtors.
The accumulated debt initially came about through a loan agreement the hotel owners signed in 2007 with the Industrial Development Corporation of South Africa and includes outstanding principle as well as outstanding interest payments.
In 2021 IDC had applied to sell the hotel to recover their outstanding loans but a temporary injuction, obtained by the hotel owners in South Africa, initially stalled this process.
AYA Investments was now given 30 days to pay or else loose the hotel on the fall of the auctioneer’s hammer, effective 25th September after all present legal challenges were thrown out by court – on the basis that once an arbitration process had been agreed to and completed, court had no jurisdiction over the award handed down.
On demand of debtors did back in February this year a liquidation process go underway in Uganda, resulting in the appointment of an official receiver and provisional liquidator.
The hotel has a chequered history with several management companies trying to have a go at the hotel and eventually, some sooner rather than later, pulling out as working with the hotel owners proved too challenging for them.
ATCNews will monitor the situation and will inform readers when the auction date near, unless additional legal challenges expected by the owners of the hotel would once again put a temporary halt to the sale of the hotel.
