Keystone Bank has taken over Bacita Sugar Company, also known as Josepdam Sugar Company, over its failure to settle a N25,358,203,258.09 debt.
Taken over on Tuesday (today), Keystone Bank appointed Yunus Abdulsalam (SAN) as Receiver/Manager of the firm with immediate effect.
This development followed an order of the Federal High Court, Ilorin, Kwara State, which mandated the bank to recover its debt from KIA Africa Group of Africa, which has acquired Josepdam Sugar Company.
The court has also frozen 21 accounts belonging to the KIA Africa Group.
The Presiding Judge, Justice A. O. Awogboro, ruling on an ex-parte motion, asked Keystone Bank to take over the management of all assets of the firm.
Justice Awogboro ruled: “It is hereby declared that in the Notice and Deed of appointment dated 30 December, 2024, the 2nd Applicant is the duly appointed Receiver/Manager over the assets of the Respondent secured as a fixed and floating charges for the loan facility granted by the 1st Applicant.
“An order of this Honourable Court is hereby made directing the 2nd Applicant, in his role as the appointed Receiver/Manager under the duly executed Debenture Deed, he is to take possession, control, and management of all assets of the Respondent secured as fixed and floating charges for the loan facility granted by the 1st Applicant.
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“An order of this Honourable Court is hereby granted restraining the Respondent herein whether acting by themselves or through their officers, servants, agents, privies, legal representatives or such other persons claiming through or acting on their behalf whosoever and howsoever described from challenging, interfering with or otherwise obstructing or frustrating the 2nd Applicant as the Receiver/Manager appointed by the 1st Applicant over all the assets of the respondents lying in any part of Nigeria, including the Respondent’s assets lying and situate at Josepdam Sugar Factory, Bacita Layout, Kwara State.
“An order of this Honourable Court is hereby made directing the Inspector General of Police, Assistant Inspectors General of Police, all Commissioners of Police in any judicial divisions of this Court including the Commissioner of Police in charge of Kwara State, his Deputy and all other Police Officers under them and all the Sheriffs of this Court in any of the judicial divisions of this Court to assist the 2nd Applicant as the Receiver/Manager in the enforcement of the Orders of this Honourable Court pursuant to the application.
“An order of this Honourable Court is further granted directing (i) First Bank of Nigeria Limited, (ii) Access Bank Plc., (iii) Citibank Nigeria Ltd., (iv) Ecobank Nigeria Pic. (v) Fidelity Bank Ple. (vi) First City Monument Bank Plc. (vii) Guaranty Trust Bank Plc. (viii) Polaris Bank Ltd. (ix) Providus Bank (x) Stanbic IBTC Bank Pic (xi) Standard Chartered Bank Ltd. (xii) Sterling Bank Pic (xiii) Union Bank of Nigeria Plc (xiv) United Bank of Africa Plc (xv) Unity Bank Plc (xvi) Wema Bank Plc (xvii) Zenith Bank Plc (xviil) Globus Bank Ltd. (xix) Heritage Banking Company Ltd. (xx) Suntrust Bank Nigeria Ltd. (xxi) Titan Trust Bank Ltd., to freeze all accounts belonging to the Respondent and that of its alter-ego, Barr. Kenneth Irihiogbe, to depose to verifying affidavit confirming the compliance to the Order of this Honourable Court pending the complete takeover of possession and control of the Respondent’s assets by the 2nd Applicant.”
When contacted at the scene of the enforcement, the bank representative said: “Keystone Bank has effectively taken over Josepdam Sugar Company in Bacita, Kwara State, known as Bacita Sugar Company, following KIA Africa Group of Africa’s failure to settle a staggering N25,358,203,258.09 debt owed to the financial institution.
“The takeover became imperative with a view to managing or outrightly disposing the Sugar Factory with a view to using the proceeds or part thereof to defray the huge debt.
“The Federal High Court in Ilorin has ordered the Nigeria Police Force to give effect to Bank’s take over in all legal ramifications.”
KIA Africa Group had successfully acquired Josepdam Sugar Company from the Assets Management Corporation of Nigeria and had earlier sought and obtained credit backing from Keystone Bank.
The bank availed KIA Africa Group series of loan facilities for the sole purpose of acquisition of the sugar factory on a mutually revised agreed 24-month repayment plan.
In a further attempt to secure full ownership of Josepdam Sugar Company, KIA Africa sought a Bank Guarantee from Keystone Bank amounting to N8,323,649,250.00, representing 75 percent of the balance purchase consideration payable to AMCON.
The bank granted this facility on the condition that KIA Africa would deposit the company’s title documents with Keystone Bank upon receiving them from AMCON, alongside a personal guarantee from its Managing Director, Kenneth Irhiogbe.
However, KIA Africa failed to fulfil this obligation, further compounding its financial liabilities.
After exhausting all entreaties for the loan repayment and with the total debt ballooning to N25.3 billion, Keystone Bank exercised its rights under the Debenture Deed by appointing a Receiver/Manager, Yunus Abdulsalam (SAN), to take control of all assets belonging to KIA Africa Group, including Josepdam Sugar Company.
The new management of the bank, led by its CEO, Hassan Imam, has aggressively embarked on strategic debt recovery drive against recalcitrant obligors.
KIA Africa Group in 2021 announced its purchase of the Sugar Company and pledged to hit the ground running.
The company said: “With the 30,000 hectares of land, inclusive of 5,600 hectares of developed farmland for sugarcane production, installed milling capacity of 40,000 tons for refined sugar, an ethanol production plant, a new mill and power equipment that are on ground awaiting installation, a pool of skilled and experienced labour waiting to be hired back into action, and support government policy for sugar sufficiency and backward integration, the Bacita Sugar Company is poised to roar back to life as a major player in the industry.
“The Kia Africa Group will make this happen.”
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