October 24, 2023
Kampala, Uganda, | The Court of Appeal has delivered a decisive blow to AYA Investments, dismissing their attempts to block the sale of the renowned Pearl of Africa Hotel, one of the crown jewels of Kampala’s hospitality scene.
Earlier this year, Court of Appeal Judge Gashirabakye, acting as a single judge, had rejected an application by AYA Investments (U) Limited (AYA) for a stay of execution. This paved the way for the South African-based Industrial Development Corporation Of South Africa Limited to proceed with the foreclosure of Pearl of Africa Hotel.
Undeterred, AYA Investments took their case to the Court of Appeal again, making a reference before a panel of three judges in an attempt to halt the impending sale of the hotel.
On October 23, a panel of three judges, comprising Egonda-Ntende, Mugenyi, and Kihika, all Justices of Appeal, further sealed the fate of AYA Investments by dismissing their reference.
The Judges unanimously held that AYA could not proceed with the reference as they had already withdrawn an application for leave to appeal. Without the application for leave to appeal, AYA had no legal standing to pursue their request for a stay of execution.
The legal battle over the Pearl of Africa Hotel dates back to the period between 2007 and 2017 when AYA Investments (U) Limited and the Industrial Development Corporation of South Africa executed various Financial Credit Agreements (FCAs) and Security Agreements to finance the construction of the iconic hotel in Kampala.
However, AYA defaulted on its financial obligations under these agreements, leading the Industrial Development Corporation Of South Africa Limited to initiate foreclosure proceedings under Ugandan law as stipulated in the Security Agreements.
Following a series of protracted legal battles, prominent law firms MMAKS Advocates and ENSafrica Advocates jointly advertised the sale of the hotel property. This property, encompassing a substantial 5.975 hectares, includes the splendid 5-star Pearl of Africa Hotel, perched at an impressive altitude of 1240 meters above sea level, offering an awe-inspiring 360-degree panorama of Kampala City.
As many continue to watch developments in thus interesting commercial dispute, the future of the Pearl of Africa Hotel will undoubtedly remain a topic of interest and discussion.
