Peter Munga. Photo | courtesy.
The High Court has lifted orders that had blocked the auction of 75 million shares owned by Equity Bank founder Peter Munga in British American Investments Company (Britam), paving the way for ABC Bank to recover a defaulted loan of Sh433 million.
The shares, currently valued at approximately Sh510 million, had been shielded from sale following a court injunction obtained by Munga.
However, in a fresh ruling, the court dismissed the earlier protection, granting ABC Bank the green light to proceed with the disposal of the securities to recoup its funds.
Justice David Majanja ruled that Equity Bank was within its rights to recover the amount through asset forfeiture after Munga failed to repay the loan, which had matured in 2023.
“The security agreement was clear, and the court finds no grounds to restrain the lender from realizing the pledged collateral,” said the judge in the ruling.
According to court documents, Munga had borrowed Sh600 million to fund various expansion projects in his businesses, with a portion of the funds channeled into agri-processing ventures.
His stake matches that of Equity Group CEO James Mwangi, both holding 75 million shares each in the financial services firm.
Britam’s shareholder register is dominated by institutional investors and prominent business figures.
Leading the list is AfricInvest with 443 million shares, followed by StanChart (Kenya) Nominees with 399 million.
EH Venture Capital holds 232 million shares, while three separate nominee accounts under StanChart Kenya collectively control over 650 million shares.
Other key stakeholders include EHL 2022 Ltd (173 million), veteran stockbroker Jimnah Mbaru (130 million), and former Britam CEO Benson Wairegi (102 million).
The court ruling places Munga’s shareholding at risk of being diluted or fully offloaded as ABC Bank seeks to enforce its creditor rights.
The bank has not disclosed the timeline for the auction but is expected to act swiftly to recover the non performing facility.
