₦25.3bn Debt: Keystone Bank Takes Over Bacita Sugar Company, Appoints Receiver
…Court Freezes 21 Accounts Linked to KIA Africa
Keystone Bank has officially taken over the operations of Bacita Sugar Company, formerly known as Josepdam Sugar Company, following the failure of its parent firm, KIA Africa Group, to repay a debt amounting to ₦25.36 billion.
In line with a ruling from the Federal High Court sitting in Ilorin, the bank has appointed Mr. Yunus Abdulsalam (SAN) as Receiver/Manager of the company, with immediate effect.
The court also ordered the freezing of 21 bank accounts associated with KIA Africa Group. The Presiding Judge, Justice A.O. Awogboro, granted the bank full authority to recover its outstanding debt by taking over the management and control of the company’s assets, secured under a debenture agreement.
In her ruling on an ex-parte motion, Justice Awogboro declared:
“The 2nd Applicant is the duly appointed Receiver/Manager over the assets of the Respondent secured as fixed and floating charges for the loan facility granted by the 1st Applicant. An order is hereby made for the 2nd Applicant to take possession, control, and management of all such assets.”
The court further restrained KIA Africa Group and its representatives from interfering with the Receiver/Manager’s duties and directed the Inspector General of Police, along with other law enforcement officials and court sheriffs, to assist in enforcing the court’s orders.
Additionally, 21 commercial banks were directed to freeze all accounts linked to KIA Africa Group and its Managing Director, Barrister Kenneth Irihiogbe, pending full compliance with the takeover order. The banks include First Bank, Access Bank, Zenith Bank, GTBank, UBA, and others.
Speaking on the development, the Receiver/Manager, Mr. Abdulsalam said:
“Keystone Bank has effectively taken over the Josepdam Sugar Company in Bacita, Kwara State, following the failure of KIA Africa Group to repay a ₦25.36 billion debt. The takeover aims at managing or disposing of the assets to recover the bank’s funds. The court has directed the Nigerian Police to support the legal enforcement of this action.”
KIA Africa Group had acquired the sugar company from the Asset Management Corporation of Nigeria (AMCON) and secured a series of loan facilities from Keystone Bank to finance the purchase. The bank also extended a ₦8.3 billion Bank Guarantee—representing 75% of the remaining purchase price—based on the assurance that KIA Africa would submit the company’s title documents and provide a personal guarantee from its CEO.
However, the group failed to meet its repayment obligations and did not deliver on the agreed collateral, causing the debt to spiral to over ₦25 billion.
In response, Keystone Bank, under the leadership of its CEO Mr. Hassan Imam, activated its rights under the debenture arrangement and initiated a recovery process, including the appointment of a Receiver/Manager.
In 2021, KIA Africa had announced its acquisition of the Bacita Sugar Company, promising a revival of the once-thriving business. The company had unveiled an ambitious plan involving 30,000 hectares of land, an ethanol plant, and a 40,000-ton milling capacity to help drive Nigeria’s sugar self-sufficiency agenda.
Despite those promises, the company’s inability to meet its financial commitments has now resulted in a court-backed takeover.
By PRNigeria
