2010-04-13
KAMPALA (Reuters) - A Ugandan court has blocked the local subsidiary of Royal Dutch Shell PLC from selling its assets in the country until it pays about $16 million to settle debts with Mercator Enterprises Limited, legal papers showed.

Earlier this month, Royal Dutch Shell said it was considering selling most of its service stations and other downstream assets in 21 African countries as part of a wider effort to reduce its global refining and marketing exposure.

The court order, seen by Reuters on Tuesday, was obtained by Mercator Enterprises, a real estate management firm, which has been locked in a longstanding dispute with Shell Uganda Limited over unpaid rent.

The order, dated April 9, prohibits Shell Uganda from transferring majority control of its shareholding or majority control of its assets until it pays Mercator Enterprises at least 35 billion Uganda shillings.

Shell Uganda country manager, Ivan Kyayonka, said that he was aware of the dispute but would not comment on an ongoing court case. There was no immediate comment from Shell UK.

A source familiar with the case told Reuters the money was for rent and interest accrued since 1972 for use of a property by Shell. The two parties agreed in 2001 to settle out of court but have never arrived at a common figure.