Revealed! Nigerian Bank takes over sugar company over N25 billion debt

• Due to nonpayment of a loan, Keystone Bank has taken implicit Bacita Sugar Company (previously Josepdam Sugar Company)
• Yunus Abdulsalam was appointed the firm's manager and receiver with contiguous effect pursuing a tribunal injunction
• In his ruling connected an ex-parte motion, the presiding justice asked Keystone Bank to instrumentality implicit each firm asset

Legit.ng writer Zainab Iwayemi has 5-year-experience covering the Economy, Technology, and Capital Market.

Bacita Sugar Company (formerly Josepdam Sugar Company) has been taken implicit by Keystone Bank owed to nonpayment of a indebtedness of N25,358,203,258.09. With contiguous effect, Yunus Abdulsalam (SAN) was named the firm's receiver and manager.

Keystone Bank has efficaciously taken implicit the Josepdam Sugar Company. Photo Credit: Keystone Bank
Source: UGC

The came aft the Federal High Court successful Ilorin issued an injunction requiring the slope to cod its indebtedness from the Josepdam Sugar Company's buyer, KIA Africa Group of Africa.

Additionally, 21 KIA Group accounts person been frozen by the court. Justice A. O. Awogboro, the presiding judge, requested that Keystone Bank presume power of each steadfast assets successful his determination connected an ex-parte motion.

The ruling

The justice ruled,

“It is hereby declared that successful the Notice and Deed of assignment dated 30th December, 2024, the 2nd Applicant is the duly appointed Receiver/Manager implicit the assets of the Respondent secured arsenic a fixed and floating charges for the indebtedness facility granted by the 1st Applicant.“An bid of this Honourable Court is hereby made directing the 2nd Applicant, successful his relation arsenic the appointed Receiver/Manager nether the duly executed Debenture Deed, “He is to instrumentality possession, power and absorption of each assets of the Respondent secured arsenic fixed and floating charges for the indebtedness installation granted by the 15t Applicant.

When contacted astatine the country of the enforcement, the slope typical said:

“Keystone Bank has efficaciously taken implicit the Josepdam Sugar Company (formerly Bacita Sugar Company) successful Bacita, Kwara State, pursuing KIA Africa Group of Africa’s nonaccomplishment to settee a staggering N25,358,203,258.09 indebtedness owed to the fiscal institution.”“The takeover became imperative with a presumption to managing oregon outright disposing the mill with a presumption to utilizing the proceeds oregon portion thereof to defray the huge debt.“The Federal High Court successful Ilorin has ordered the Nigeria Police Force to springiness effect to bank’s instrumentality implicit successful a ineligible ramifications.”

What happened?

The Assets Management Corporation of Nigeria (AMCON) sold Josepdam Sugar Company to KIA Africa, which had antecedently applied for and received recognition enactment from Keystone Bank.

The slope utilized a fig of indebtedness facilities offered by the KIA Africa Group specifically for the acquisition of the sweetener mill connected a 24-month repayment program that was mutually revised.

KIA Africa requested a slope warrant from Keystone Bank for N8,323,649,250.00, oregon 75% of the remaining acquisition information owed to AMCON, successful an effort to get implicit ownership of the company.

The slope provided this indebtedness with the knowing that KIA Africa would supply a idiosyncratic warrant from its managing director, Kenneth Irhiogbe, and deposit the company's rubric documents with Keystone Bank as soon arsenic they were received from AMCON.

But KIA Africa didn't fulfill this commitment, which made its fiscal problems worse. After each pleas for indebtedness repayment had been exhausted and the full indebtedness had risen to N25.3 billion, the slope utilized its rights nether the Debenture Deed to designate Abdulsalam to presume power of each KIA Africa Group assets, including the sweetener company.

The bank's caller administration, headed by Mr. Hassan Imam, the CEO, has aggressively started a systematic indebtedness betterment run against uncooperative debtors.

“KIA Africa Group successful 2021 announced its acquisition of the Sugar Company and pledged to deed crushed running.

21 KIA Group accounts person been frozen by the court. Photo Credit: Contributor
Source: Getty Images

The Company said:

“With the 30,000 hectares of land, inclusive of 5,600 hectares of developed farmland for sugarcane production, installed milling capableness of 40,000 tons for refined sugar, an ethanol accumulation plant, a caller mill and powerfulness instrumentality that are connected crushed awaiting installation, a excavation of skilled and experienced labour waiting to beryllium hired backmost into action, and enactment authorities argumentation for sweetener sufficiency and backward integration, the Bacita Sugar Company is poised to roar backmost to beingness arsenic a large subordinate successful the industry. The Kia Africa Group volition marque this happen.”

Keystone Bank speaks connected FG takeover

Legit.ng reported that Keystone Bank Limited has clarified reports of a judgement by the Lagos State Special Offences Court successful Ikeja, connected Tuesday, February 11, 2025, which handed implicit the bank to the Nigerian government.

The tribunal bid besides concerns the presumption of the erstwhile shareholders of the bank, Sigma Golf Nigeria Limited and Umaru H. Modibo.

According to a connection by the bank’s management, the improvement comes aft respective actions by the Central Bank of Nigeria (CBN) to fortify the banking sector.

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Source: Legit.ng