Court Authorizes Keystone Bank’s Takeover Of KIA Africa’s Bacita Sugar Company Over N25.3 Billion Debt

The bank has also appointed Yunus Abdulsalam as the receiver/manager of the firm with immediate effect.

This development follows an order of the Federal High Court, Ilorin, mandating the bank to recover its debt from KIA Africa Group, which had acquired Josepdam Sugar Company. The court also ordered the freezing of 21 bank accounts belonging to the KIA Group.

Presiding over the case, Justice A.O. Awogboro ruled on an ex-parte motion, authorizing Keystone Bank to take over the management of all assets of the firm.

The judge stated:

“It is hereby declared that in the Notice and Deed of Appointment dated 30th December 2024, the 2nd applicant is the duly appointed receiver/manager over the assets of the respondent, secured as fixed and floating charges for the loan facility granted by the 1st applicant.”

The court further issued an order:

“Directing the receiver/manager to take possession, control, and management of all assets of the respondent secured as fixed and floating charges for the loan facility granted by the 1st applicant.”

Additionally, the court restrained KIA Africa from interfering with the operations of the receiver/manager, specifically preventing any obstruction or disruption of the takeover process at the Josepdam Sugar Factory, Bacita Layout, Kwara State.

To ensure full compliance with the takeover, the court directed the Inspector General of Police, Assistant Inspectors General of Police, Commissioners of Police, and other law enforcement officers to provide necessary assistance to the receiver/manager in executing the court’s order.

Furthermore, the court instructed 21 commercial banks, including First Bank, Access Bank, GTBank, and Zenith Bank, to freeze all accounts belonging to KIA Africa Group and its Managing Director, Barr. Kenneth Irihiogbe, pending the full enforcement of the takeover.

Speaking at the scene of the enforcement, a Keystone Bank representative confirmed:

“Keystone Bank has effectively taken over Josepdam Sugar Company in Bacita, Kwara State, following KIA Africa Group’s failure to settle its staggering N25.3 billion debt owed to the financial institution. The takeover is necessary to manage or dispose of the sugar factory and use the proceeds to recover the outstanding loan.”

“The Federal High Court in Ilorin has ordered the Nigeria Police Force to enforce the bank’s takeover in full compliance with the law.”

KIA Africa acquired Josepdam Sugar Company from the Assets Management Corporation of Nigeria (AMCON) and secured credit backing from Keystone Bank to finance the purchase. The bank extended several loan facilities with a 24-month repayment plan.

Additionally, KIA Africa obtained a Bank Guarantee of N8.32 billion (75% of the outstanding purchase price) from Keystone Bank, under the condition that the company would deposit its title documents with the bank upon receiving them from AMCON. A personal guarantee from Barr. Kenneth Irihiogbe was also required.

However, KIA Africa failed to fulfill this obligation, further compounding its financial liabilities. After multiple failed repayment attempts, and with the total debt rising to N25.3 billion, Keystone Bank exercised its rights under the Debenture Deed and appointed a receiver/manager to take full control of KIA Africa’s assets, including Josepdam Sugar Company.

Under the leadership of its CEO, Mr. Hassan Imam, Keystone Bank has intensified its efforts to recover outstanding debts from defaulters.

When KIA Africa acquired Josepdam Sugar Company in 2021, it pledged to revitalize the business, stating:

“With 30,000 hectares of land, including 5,600 hectares of developed farmland for sugarcane production, an installed milling capacity of 40,000 tons, an ethanol production plant, and power equipment awaiting installation, Bacita Sugar Company is poised to become a major player in the sugar industry. The KIA Africa Group is committed to making this vision a reality.”