allafrica

Creditors of the fallen oil marketing company, Triton, will have to wait until mid next month to know if the planned sale of key assets, estimated to be worth billions of shillings, will go on.

This emerged on Tuesday after its Interim liquidator temporarily lost a bid to have the High Court issue orders blocking two companies associated with Triton's fugitive owner, Yagnesh Devani, from disposing of the property.

The development has effectively heightened the ongoing scramble for Triton assets among a host of secured and unsecured creditors.

Triton's interim liquidator, Ponangipalli Rao, wanted managers of the two firms--Dreamcatchers Limited and Camelot Estates-- blocked from selling prime assets which are suspected to have been developed using money drawn from Triton Petroleum Company's accounts.

Mr Rao had argued that the sale of the assets may jeorpadise unsecured creditors owed money by the collapsed company.

But Justice Joyce Khaminwa declined to give the orders and instead set a fresh hearing of the application for January 18, 2010.

The judge declined to block the disposal of a housing development located on General Mathenge Drive owned by Dreamcatchers Limited and Camelot's "multi-billion shilling" property complex situated on Nairobi's Waiyaki Way.

If the said assets have already been sold prior to the filing of the application, the liquidator wants the proceeds after the payment of any secured creditors to be deposited with the court or in an escrow account pending the hearing and determination of the suit.

"The sale of the assets to a third party may jeopardise and frustrate any chances of unsecured creditors of Triton from recovering the substantial sums represented by the said assets, " said the liquidator through his lawyer Antony Njogu of Daly & Figgis Advocates.

This came as it emerged that East African Development Bank (EADB) planned to dispose of Camelot House for over Sh1.2 billion to recover a Sh410 million debt owed to it by Triton.

EADB have the legal charge over the property, according to the Deed of Settlement on the disposal of Triton's assets.

This came after an order by the property contractor Laxmanbhai Construction Limited was vacated, giving EADB the leeway to sell the asset.

The contractor--who is to get Sh186 million from the disposal--was initially opposed to the sale, saying there was an illegality in the planned disposal.

In the November case, Laxmanbhai argued that Camelot Estates, KCB and PTA had conspired to defeat the interest of the contractor and to cause it financial loss by selling the property and distributing the proceeds to themselves.

The development means EADB--which had financed the development of the property through a loan to Camelot --can proceed and sell the property.

Court documents filed in court show that the sale process could take at least 120 days including advertising, scrutinising the bids and giving the purchaser time to raise the Sh1.2 billion price.

This is the latest twist in the scramble for the assets by the major creditors of Triton. Creditors have been locked in a row over the structure to be adopted in disposing of some of the assets, which has delayed the anticipated sale within the court's stipulated time.

The biggest tussle has been for the most valuable asset of the company--the massive multi-billion shilling oil terminal which Mr Devani was building in Mombasa before his business empire imploded early this year.

EADB, Kenya Commercial Bank and PTA bank, Camelot and the contractor have been locked in a tussle over the sale of the Camelot facility.

They all wanted to be involved in formulating the terms and conditions of sale.

"The lengthy and bloodier fight would be to divide the surplus after the disposal, " said EADB through its lawyer Njoroge Regeru.

KCB, which has sued Triton for Sh2 billion for oil imports secured by the bank through various debentures argued that it had substantial interest in the sale of the property to recover the debts.

According to the deed of settlement signed between Triton, Mr Devani and the receivers on March 16, 2009, after the sale of Camelot property, the other beneficiaries would be receivers who would get Sh470 million while the balance, if any, would be used to clear any other outstanding liabilities on the company.

In August, the High Court ruled that the assets of the Triton Bulk Storage Company be sold in what was a win for Triton's main creditor KCB and its appointed receiver managers.

Proceeds of the sale were to be banked in a joint account of KCB and Fortis Bank of Netherlands.

High Court judge Luka Kimaru ordered the disposal of the property in Mombasa within 60 days and that the money be deposited in an escrow account in a reputable bank to be managed by the advocates of KCB and Fortis Bank.