Kampala – The Simba Group of companies owned by businessman Patrick Bitature tried in 2018 to pay its lender, Vantage Capital, $15, but the South Africa-based company reportedly rejected the money.
Simba Group owners and lawyers now believe Vantage Capital is no longer interested in the money but in the ownership of the former, including Skyz Hotel Naguru, Protea Hotel Kololo, Elizabeth Royal Apartments Kololo and Moyo Apartments, all valued at $150 million.
Origin: In 2014, Bitature’s Simba Group of Companies secured a $10 million loan from Vantage to build the Skyz Hotel in Naguru, Kampala. The loan was based on oil and gas development in Uganda.
It is important to note that the final investment decision (FDI), the final oil production agreement between the government, Total, CNOOC became a crucial element in the commitment and repayment of the loan. Interest payments were to begin in December 2017.
In 2017, the Simba group of companies wrote to Vantage, before the expiry of the grace period, to reconsider the interest payment deadline since the FID had not yet taken place.
“It was international knowledge that the FID which was to be signed by 2017, and the oil development as a result, had not taken place. Simba Group of Companies brought this to the attention of Vantage,” said a member of the Simba Group legal team.
Vantage Capital reportedly resented the current situation, subsequently forcing Simba Group of Companies to take it to court. The court did indeed grant temporary relief and the two sides sat down and agreed to an extension of the deadline until 2019.
In 2019, Vantage Capital demanded an astronomical $18 million, with interest calculated unilaterally from 2017, not the mutually agreed-upon 2019.
There was again a disagreement and later the two parties agreed on a buyer. Vantage would have frustrated all potential buyers and, in the same process, would have continued to aggravate interest.
Simba Group then decided in 2018 to repay the $10 million to Vantage with a profit of $5 million but Vantage refused to take the money. Vantage went ahead and recruited auctioneers to commandeer the property.
On May 18, 2022, Ugandans woke up to the announcement of auction of Bitature property including Skyz Hotel Naguru, Protea Hotel Kololo, Elizabeth Royal Apartments Kololo and Moro Apartments.
Vantage Capital, in a subsequent statement on Monday, May 23, 2022, said it was opting for security (ownership) if Simba Group did not pay the now compounded US$34 million.
“Vantage will persist in recovering its long overdue loan, exercising its rights against collateral if necessary,” Vantage Capital said.