President Museveni has indicated his desire to save Pearl of Africa Hotel in Nakasero from being auctioned over debts.
In a May, 1, 2024 letter, the president wrote to Industrial Development Corporation of South Africa Ltd,a South African company that wanted to sell the hotel to recover money it had lent to Aya Group asking to meet them.
Museveni said he had been approached by Mohammed of Aya Investments (U) Ltd Group regarding the imminent sale of his hotel due to his indebtedness to the South African lender.
“I have been informed that the sale has been sanctioned by courts having decided several cases in your favor. However, given that Pearl of Africa hotel is a strategic investment that was supported by government through land allocation and other benefits,” Museveni said.
He said government is willing to intervene so that the debt is paid instead of auctioning the hotel.
“I, therefore, wish to hold a meeting with you to discuss other ways of recovering your loan instead of selling the hotel. I am, therefore, directing that the auctioneer halts the sale of the hotel pending my meeting with you.”
The letter has also been copied to the Principal Judge, the auctioneer and Aya Group.
This state of affairs stemmed from a court case in which Industrial Development Corporation of South Africa Ltd secured an order allowing them to put the hotel up for sale to recover over $118million (Shs429billion) from Aya Group.
In 2021, Aya Investments applied for a temporary injunction stopping the sale of its hotel by Industrial Development Corporation of South Africa Ltd.
This was after the South African company indicated that it wanted to sell the hotel to recover the money lent to Aya.
It stems from 2007 when Aya entered into financing agreements with the South African company while constructing the hotel in Nakasero but according to Aya, misunderstandings developed mid-way, with accusations and counter accusations.
Aya in his defence to court, Aya said the South African company committed several breaches of the financing agreements, which resulted in gross delay of hotel operations and the heavy losses occasioned.
In February last year, the liquidation process of the AYA Investments Uganda Ltd commenced, and court-appointed Robert Mugabe, the director of insolvency and receivership at the Uganda Registration Services Bureau (URSB), the official receiver, and subsequently, the provisional liquidator.
