Tycoon Peter Munga to lose Sh510 million to auctioneers

By Newsflash Writer

The High Court in Kiambu has lifted temporary orders that had blocked the auction of 75 million Britam shares owned by billionaire businessman Peter Munga, paving the way for ABC Bank to proceed with the sale.

Justice Dorah Chepkwony dismissed Munga’s plea to extend the orders, which had restrained ABC Bank and its investment arm, ABC Capital, from selling his Britam Kenya stake currently valued at Sh510 million.

Peter Munga, best known as the founder of Equity Bank, has since evolved into a prominent entrepreneur with investments spanning insurance, agro-processing, education, and manufacturing. In recent years, he has earned hundreds of millions of shillings from the sale of his shares in both Britam and Equity Bank.

This latest court ruling marks a fresh chapter in Munga’s financial struggles, with the Britam stake auction becoming the most recent case involving his assets being targeted to settle outstanding debts. The businessman had obtained interim court orders on February 3, 2025, halting the sale of the shares, which had been pledged as collateral for a loan issued to Equatorial Nut Processors — a firm he owns — to finance a contract with the World Food Programme.

However, Justice Chepkwony found that Munga had misled the court by failing to reveal that he had already filed a similar case in Nairobi seeking identical reliefs. The judge said this omission amounted to an abuse of court process.

“Having established that the plaintiff came before this court without disclosing the existence of another suit seeking the same reliefs, such conduct is a clear abuse of judicial process,” said Justice Chepkwony. “Consequently, the interim orders issued ex-parte on February 3, 2025, are hereby set aside and discharged.”

Bank says Munga personally garanteed the loan

Munga had filed parallel applications in both the Kiambu and Nairobi courts in an apparent effort to block the auction from different legal fronts. The judge criticized this tactic, stating that parties cannot file similar matters in multiple courts in the hope of obtaining a favorable ruling.

“This amounts to forum shopping — a discredited litigation strategy where a litigant files cases in different jurisdictions hoping for a favorable ruling or to evade a negative outcome,” she said.

ABC Bank had issued a demand letter to Munga seeking payment of Sh433,767,398.33 following the loan default by Equatorial Nut Processors. The letter warned that failure to pay would result in the disposal of Munga’s Britam shares to recover the debt.

Logo of Britam Insurance firm. Photo/Britam

The firm, founded in 1994 and situated near Maragua town, processes macadamia, cashew, and peanuts. Official records show Munga owns a 92 percent stake in the company, while his business associate, James Karanja, holds the remaining 8 percent.

Despite the demand, Munga disputed the bank’s claim and told the court he intended to use the same shares as collateral for another loan. He also argued that the bank’s actions violated the in-duplum rule, which caps interest accumulation to prevent it from exceeding the original loan amount.

ABC Bank and ABC Capital contested this claim, stating that honoring Munga’s application would distort the agreed loan terms. In a sworn statement, Faith Nteere, the bank’s senior legal manager, said ABC Bank had advanced multiple loan facilities to Equatorial Nut Processors, with Munga signing the loan documents in both a personal and corporate capacity. He also executed a personal guarantee to repay the loans in case of default.

Munga directly owns 75 million Britam shares and holds substantial indirect stakes through EH Venture Capital and EHL 2022 — two investment vehicles with a combined holding of 405 million Britam shares valued at Sh2.75 billion.

This isn’t the first time the tycoon has faced potential asset seizures. In 2023, three of his properties were lined up for auction over unpaid loans. And in October 2017, he narrowly escaped losing five homes in Nairobi’s Kasarani area — then worth Sh400 million — by making a last-minute payment to Jamii Bora Bank, now known as Kingdom Bank.