Kenyan multimillionaire and Equity Group Founder Peter Munga is confronting yet another financial challenge as creditors move to auction off his multimillion-dollar properties in an effort to recover unpaid debts.
This marks the latest chapter in Munga’s ongoing struggle with debt, which has seen him narrowly escape property auctions in the past.
In a public notice, Legacy Auctioneering Services announced the impending auction of two vacant commercial properties spanning 0.36 acres, each located in Murang’a County. The auction is scheduled for Oct. 13, 2023, and these land parcels are held on a leasehold basis. Additionally, an industrial-cum-residential property in Meru County, covering a vast 15.6 acres, is set to go under the hammer on Oct. 17, 2023.
Munga, a top figure in East Africa’s financial sector, is no stranger to property auctions due to outstanding debts. In October 2017, he narrowly averted the auction of his five houses in Nairobi’s Kasarani, valued at Ksh400 million ($2.72 million at the time), by making a last-minute payment to Jamii Bora Bank.
The current financial turmoil facing Munga stems from credit facilities obtained by him and his business associate, James Karanja. These credits relied heavily on guarantees provided by their firms, Equatorial Nut Processors and Meru Ginnery, which happen to own the assets now targeted for sale.
Equatorial Nut Processors, one company that guaranteed Munga’s loans in the upcoming auction, operates near Maragua town. Established in 1994, the company specializes in processing macadamia nuts, peanuts, and cashew nuts, employing over 1,000 workers.
Munga is widely known for his extensive business portfolio, spanning various sectors such as agriculture, education, and insurance. Notably, he owns 72 million shares in Britam Holdings, making him one of the company’s largest shareholders. Additionally, he retains a minority stake in Equity Group Holdings.
Munga’s financial dealings have attracted attention in recent years. In 2021, a Mauritian commission of inquiry uncovered a secretive purchase of 452.5 million shares of Britam Holdings Plc from the Mauritian government, resulting in a reported Ksh3.9-billion ($35.9 million) loss for the country. The transaction, which took place in 2016, sparked controversy due to allegations of undervaluation.
Competitors, including South Africa’s MMI Holdings and Barclays Bank (now Absa Group), had reportedly offered higher bids for the stake, each willing to pay Ksh11 billion ($101.24 million). Munga had initially promised to match this figure but eventually acquired the shares at a significantly lower price.
Subsequently, Munga divested from Britam Holdings, selling 104 million shares in the open market in 2017, then the disposal of 348.5 million shares to the Zurich-based multinational Swiss Re in 2018. These transactions reportedly earned him billions of shillings in capital gains.
