Popular businessman and media mogul S.K Macharia is staring at his assets being seized by the State, including Royal Media Services (RMS), after he lost an appeal challenging a court ruling that declared him bankrupt. The State Law Office on Friday issued a bankruptcy receiving order, allowing the State to take over and supervise Macharia’s businesses with the view to servicing all his debts.
This comes after Mr Macharia and his wife Gathoni Macharia lost the appeal last year that sought to block them from being declared bankrupt over the Ksh500,000 debt, which has since grown to Ksh293.4 million.
The State Law Office has tapped Mark Gakuru, the official receiver to supervise the businessman’s assets. Mr Gakuru has been instructed to review Macharia’s financial statements and assess liabilities which will give him the bird’s eye view needed to start servicing the debts owed by the businessman.
“The official receiver will prepare a statement of affairs detailing all his assets and liabilities with a view to setting them,” the publication quoted an anonymous source at the AG’s office.
“The notice has been issued for the benefit of all creditors and captures all his debts, all bank loans, suppliers and any other creditors.”
This means despite being considerably wealthy, Mr. Macharia will lose access to his businesses, bank accounts, and property that will be under the watch of the official receiver. He also runs the risk of losisng his positions as a director in the company he owns including Royal Media Services.
RMS is the media stable that owns Citizen TV, the tv channel with the largest viewership in the country as well as Inooro TV, Radio Citizen, Hot 96 and an avalanche of vernacular radio stations.
However, Mr. Macharia could decide to stop the receiver from taking any action by providing him with a plan on how he intends to repay all his debts and enter into court-supervised agreements with all the creditors.
The law demands that Mr Gakuru summon a general meeting of the creditors to discuss how to deal with the businessman’s property. Mr Macharia is also expected to provide the receiver with a statement of his wealth that includes his assets, debts and liabilities as well as securities held by people he owes money.
Mr Macharia lost an appeal, which sought to bar the State from enforcing a 2009 bankruptcy ruling, last year.
While he has moved to the Supreme Court to challenge the appellate’s court decision, he is yet to secure an order freezing the judges’ orders.
All this comes after Mr. Macharia lost the battle to bar businessman Livingston Waithaka, the Managing Director of Ocean Freight Transporters Company Limited, from declaring him bankrupt for failing to refund him Ksh500,000 in a land deal that fell through.
The High Court in 2001 ordered Mr Macharia to repay the debt with an annual interest of 19 per cent that is compounded monthly from December 1986 following the botched land deal.Mr. Macharia ignored the ruling until 2008 when Mr. Waithaka served him with bankruptcy notices.
The High Court judges said the debtors failed to settle the amount despite bankruptcy notices having been issued to them.