The High Court has restrained KCB Bank from placing Proctor & Allan Ltd under receivership over a Ksh3.7 billion loan.
Lady Justice Njoki Mwangi of the Milimani Commercial & Admiralty Division of the High Court issued the stay orders on 27th February.
The High Court has placed in abeyance the appointment of Swaroop Rao Ponangipalli and Ponangipalli Venkata Ramana (PVR) Rao as Receiver Managers pending the hearing and determination of the case.
KCB Bank has also been restrained from denying the directors and authorized officials of the Company unfettered access to the assets, offices, security keys, all company records, emails, all funds, all bank accounts, all contracts and attendant documents and all matters pertaining to and related to Proctor & Allan Ltd.
The bank has been ordered to file and serve their responses within 30 days from February 28, 2025.
The application will be mentioned for further directions on March 13, 2025.
KCB Places the Company Under Receivership
KCB Group placed the giant cereals manufacturer under receivership due to the company’s struggles to repay a loan used to acquire a manufacturing plant in Limuru, Kiambu County, back in 2015.
The Company is known for its popular cereals, including cornflakes, oats, porridge mixes and cake mixes.
Proctor & Allan Ltd has been battling financial challenges due to increasing competition and the harsh economic environment.
Also Read: Safaricom Fined After Company Shares Ex-Employee ID
The High Court placed the firm under the receivership of Ponangipalli Venkata Ramana Rao and Swaroop Rao Ponangipalli, effective February 24.
The receivers urged all claimants to submit their claims against the company by March 31, 2025.
Also Read: 6 Tips on How to Run a Company in Turbulent Times – Lessons from Emerging Markets
Proctor & Allan Ltd Owners
It is one of the oldest food processors in the country, having entered the market in the 1940s.
The Company is owned by several popular Kenyan businessmen who flourished during the reign of late President Mwai Kibaki.
This includes Zephania Mbugua, the former chairman of East African Cables, Edward Njoroge, the former CEO of KenGen, and Ngugi Kiuna, a prominent businessman with substantial interests in several industries.
Nefira Holdings, which controls a majority stake of 76.82%, is listed as the largest shareholder.
Proctor & Allan Ltd is among the latest companies to enter receivership or administration, joining Mastermind Tobacco, a leading cigarette manufacturer, and LSHS, an automobile body firm.
Follow our WhatsApp Channel and join our WhatsApp Group for real-time news updates.
