Mahadi Energy Limited, a leading fuel importing and distribution company, has moved to court seeking to block the auctioning of its properties in Nairobi and Mombasa over a disputed Sh630 million bank loan.
The company claims that four of its prime parcels of land were auctioned without its knowledge by Premier Bank Limited, formerly First Community Bank Limited, in a move it terms as irregular and unlawful.
According to affidavits filed by the company’s Managing Director, Ibrahim Hussein, Mahadi Energy borrowed Sh631 million from the bank in 2011. By 2018, the firm had reportedly repaid Sh530 million and requested a detailed statement to reconcile the remaining balance. However, Hussein alleges that the bank failed to provide the statement and instead demanded payment of the full loan amount, disregarding the repayments already made.
The dispute escalated when the bank allegedly auctioned four parcels of land belonging to Mahadi Energy—two in Nairobi (along Mtelo Road in South C and Juja Road in Pangani) and two in Mombasa (along Mainland North Road). The properties were reportedly purchased by Shabeel Project Services Limited, which has since evicted Mahadi from the premises after obtaining court orders.
Mahadi Energy has now moved to the Environment and Land Court in Nairobi, arguing that the eviction orders were obtained without disclosing to the court that a separate petition over the disputed loan is still pending before the High Court in Mombasa, which had earlier issued conservatory orders to maintain the status quo.
Justice has since certified Mahadi Energy’s application as urgent, scheduling the hearing for December 8. The company contends that the bank’s actions amount to material non-disclosure and abuse of court process, calling for the reversal of the auction and restoration of its properties pending the resolution of the loan dispute.
