Businessman Peter Munga is facing an impending auction of three prime properties owned by him, marking another debt-related challenge for the billionaire investor. These properties are set to be auctioned by creditors who are seeking to recover unpaid dues.
Munga, along with his business associate James Karanja, had obtained credit facilities of unspecified amounts, relying on guarantees provided by their firms, Equatorial Nut Processors, and Meru Ginnery, both of which own the properties now targeted for sale.
A notice issued by Legacy Auctioneering Services indicates that two vacant commercial properties totaling 0.36 acres in Murang’a County will be up for auction on October 13, 2023. These land parcels are held on a leasehold basis.
In addition, an industrial-cum-residential property in Meru County, sprawling over 15.6 acres, is scheduled for auction on October 17, 2023. The property features a ginnery factory with five permanent go-downs, storage space, offices, ablution blocks, a weighbridge, and two servants’ quarters. Similar to the Murang’a properties, this one is also held on a leasehold tenure.
While the insider at Legacy Auctioneering Services revealed that the debt amounts to millions of shillings, the details of the creditors have not been disclosed. As of the time of this report, Mr. Munga had not responded to inquiries.
This is not the first time Mr. Munga has faced a debt battle. In October 2017, he managed to avert the auction of five houses worth Sh400 million in Nairobi’s Kasarani area by making a last-minute payment to Jamii Bora Bank. The exact value of the loan owed to the bank at that time was not disclosed.
Peter Munga, who founded Equity Bank, has investments in various sectors, including agriculture, education, and insurance. Equatorial Nuts Processors, which has guaranteed part of the loans in the current auction, processes macadamia nuts, peanuts, and cashew nuts. It employs over 1,000 people and exports nuts to various regions, with an annual turnover exceeding Sh1 billion.
Additionally, Mr. Munga had ventured into cotton farming through Meru Ginnery in 2013, with the aim of manufacturing towels and diapers, seeing potential for profitable returns in the textile industry. He cited opportunities under the Africa Growth and Opportunity Act as a motivation for his investment.
Peter Munga joins a list of prominent entrepreneurs who have faced auctions in recent years due to unpaid bank loans, some of which have amounted to hundreds of millions of shillings.