Manu Chandaria’s Wealth: Billionaire industrialist Manu Chandaria is facing possible auction over a Sh. 6 billion debt that was taken by one of his companies.
A report that appears in the Business Daily says that the debt was taken by Kaluworks Limited, a manufacturing firm that is part of billionaire Manu Chandaria’s Comcraft Group.
It is this company that will be auctioned.
“Kaluworks is indebted to among other lenders I&M Bank, which has already published notices for auction of the company’s assets. The company also owes NIC Bank and Bank of Baroda loans that are currently not performing, in addition to hundreds of millions of shillings in a commercial paper whose repayments it has defaulted on,” says the Business Daily.
Here’s the full report as published in the Business Daily:
In November, I&M Bank instructed Nairobi-based Keysian Auctioneers and debt collectors to attach a multimillion property in Nairobi that had been used to guarantee a loan for Kaluworks after the firm failed to honour its obligation to the bank.
“Duly instructed by I&M Bank Limited the chargees to the above named property, (Forest View Flats, Ngara West) we shall sell by way of public auction for the recovery of $527,887 (about Sh53.6 million) and Sh233.9 million as at 25 August 2018, which amount continues to attract interest until payment in full,” says the confidential letter dated November 28, 2018 and seen by the Business Daily.
This was followed by another notice mid last month for a public auction of separate assets that were also used to secure multi-million Kaluworks loans.
Credit officers from the affected banks who sought anonymity because they are not allowed to speak to media said the banks loaned the money to Kaluworks because Mr Chandaria allegedly presented himself as the face of the company.
Mr Chandaria is the chairman of Comcraft Group, a conglomerate with multiple businesses across Africa and beyond of which Kaluworks is a member.
The industrialist is also a long-serving chairman of the Kaluworks board of directors.
When reached for comment Thursday, Mr Chandaria said he had resigned from the Kaluworks board “a few years ago”.
He said he currently “does not have anything to do with the company” and was only linked with the company “through representing foreign firms”.
Information on its website shows that Kaluworks Limited was set up in 1929.
“The company has created history by continuously growing over the last 80 years. Predominantly a cookware manufacturer, Kaluworks in 1988 diversified into Aluminium Rolled Products, by setting up a state of the art Aluminium Rolling Plant in Mariakani near Mombasa,” the website states.
Among its assets are a foundry, continuous caster, cold rolling mill and “other finishing equipment.”
“Kaluworks started rolling out high quality Aluminium Coils, Sheets, Circles and Roofing Products. The company has established its mark as a manufacturer of quality aluminum roofing products and carved a niche for excellence in performance and quality in the Eastern & sub-Sahara African region,” it says.
Information about Kaluwork’s distress emerged on a day the company was linked to another default by a financial services group, Sanlam.
Sanlam Kenya group chief executive Patrick Tumbo at a press conference in Nairobi Thursday listed Kaluworks as one of the defaulters of a commercial paper it invested in.
Sanlam had to write off Sh1.15 billion mainly related to investments in firms that fell into financial distress, pushing it into a shock Sh1.53 billion net loss in the six months ended June.
“For Kaluworks, who thought that Manu Chandaria could default on a commercial paper?” asked Mr Tumbo Thursday.
Mr Chandaria, 89, is a philanthropist and business leader, associated with his multi-billion shilling Comcraft Group.
The group produces steel, plastics and aluminum products in 45 countries. His Kenyan stable also includes Mabati Rolling Mills.
In 2011, Mr Chandaria made it to the Forbes 40 Richest Africans list. In 2013, the New World Wealth report, a US publication, recognised the Kenyan businessman for his achievements as an industrialist who had grown the family business to at least 18 countries in Africa.
The following year, Comcraft Group was estimated to be worth about Sh203 billion ($2 billion).
The woes facing Kaluworks are just but the latest in a series of high-profile disputes facing local firms and seen as reflecting the difficulties that companies are facing on the sales front.