Aya Group’s renowned Pearl of Africa Hotel, nestled in the leafy Nakasero environs, has been thrust into the spotlight as auctioneers from Armstrong Limited announce the sale of this iconic five-star establishment.
Credit: Ideas House.
The decision to auction the hotel comes as a last resort for a financial institution looking to recover debts totaling over $118 million (Shs 429 billion), setting the stage for a high-stakes financial battle that has been years in the making.
The saga traces its roots back to 2007 when Aya Group entered into financing agreements with the Industrial Development Corporation of South Africa Ltd while constructing the opulent Pearl of Africa Hotel. However, over time, misunderstandings and disputes arose between the two parties, leading to accusations and counter-accusations.
In response to these disputes, Aya Group claimed that the South African company had repeatedly breached the financing agreements, causing significant delays in hotel operations and incurring substantial financial losses.
This discord eventually culminated in a court case in which the Industrial Development Corporation of South Africa Ltd successfully obtained an order allowing them to auction the hotel to recover the massive outstanding debt.
The auctioneers, Armstrong Limited, have made it clear that they will proceed with the sale unless the judgment debtor satisfies the entire outstanding decretal sum, including interest, as well as covering their fees.
Earlier this year, the liquidation process for AYA Investments Uganda Ltd was set in motion, with Robert Mugabe, the director of insolvency and receivership at the Uganda Registration Services Bureau (URSB), appointed as the provisional liquidator.