Kampala, Uganda | THE BLACK EXAMINER | Aya Investment Limited, the owner of Pearl of Africa Hotel in Kampala, has once again failed to prevent the auction of the hotel due to outstanding loans totaling over US$ 300 million. The Court of Appeal, composed of judges Fredrick Egonda-Ntende, Monica Mugenyi, and Oscar Kihika, ruled against Aya in a reference filed against their financiers, the Industrial Development Corporation of South Africa Limited, to halt the execution of the auction order.
The judges found the reference baseless after Aya withdrew the substantive appeal that formed the basis of their stay of execution application. The court dismissed the reference with costs awarded to the respondent.
According to court records, Aya Investments Limited, owned by businessman Muhammad Hamid, and the Industrial Development Corporation of South Africa entered into financial credit agreements and security agreements from 2007 to 2017 to finance the construction of Pearl of Africa Hotel. Disputes and alleged defaults led to foreclosure proceedings, with Aya preferring arbitration as per their loan agreements. Aya also obtained restraining orders against the foreclosure, leading to a civil suit filed by his financiers. Aya’s legal challenges ultimately favored his financiers, who obtained court orders for execution, including the closure of the hotel.
Aya’s subsequent application to challenge the execution orders was unsuccessful, prompting him to file a reference to the Court of Appeal. The court upheld the objection raised by the Industrial Development Corporation’s lawyers, emphasizing that the withdrawal of the application for leave to appeal rendered the reference baseless.
Unless appealed in the Supreme Court, this ruling paves the way for the auction of Pearl of Africa Hotel, situated on Nakasero Hill, formerly owned by the Uganda Broadcasting Corporation. The hotel’s sale aims to settle the owner’s accumulated debts. Muhammad Hamid has sought help from President Yoweri Museveni, alleging unfair actions by those seeking to dispossess him. Museveni has not publicly commented on the matter.
Previously, Museveni has intervened to assist distressed businessmen facing substantial loans, including Patrick Bitature, owner of Protea Hotel, when another South African financier demanded over US$ 30 million in principal and interest from an unpaid loan, preventing a financial collapse.”
