The High Court has allowed the Official Receiver to take over a 40-acre parcel of land in Ruiru, Kiambu County belonging to companies linked to Cytonn, for sale and proceeds be shared among investors who lost billions.
Justice Alfred Mabeya allowed the application by the Official Receiver after dismissing objections by the firms, arguing that they were different entities from Cytonn High Yield Solutions, which was placed under liquidation.
The judge said the two Special Purpose Vehicles (SPVs) did not give concrete reasons as to why the property should not be sold for the benefit of the investors.
“The money loaned to the two companies have not been paid up and the only recourse is for the said property to be vested in the Official Receiver for him to liquidate the same for the benefit of languishing investors,” said the judge.
The Official Receiver sought to be allowed to have title documents for the property known as Riverun in Ruiru. He also prayed that 40 acres be given to him as the liquidator of Cytonn High Yield Solutions and Cytonn Real Estates projects.
The Receiver further urged the court that 50.08 acres should be registered in the name of Muiruri Laban Limited (MLL).
MLL was the registered proprietor of the property with 50 percent rights while Cytonn Real Estate LLP had the technical know-how and Cytonn Investment Management Plc (CIMP) was to raise funds for the projects, and each acquired 25 percent rights.
Cytonn High Yields Solutions LLP (CHYS) entered into a financing agreement with CIP 12 LLP to loan the incorporated SPVs Sh1 billion for the sole purpose of meeting the needs of the land owner in the joint venture.
Cytonn Real Estate Project Notes LLP then entered into a financial agreement with CIP LLP to facilitate the acquisition of the property.
The project, however, failed to take off and the deal was dissolved on November 11, 2022.
