Renowned billionaire and founder of Equity Group, Peter Munga, is facing yet another financial challenge as creditors move forward with plans to auction off his multimillion-dollar properties to recover unpaid debts. This marks the latest episode in Munga’s ongoing battle with debt, a struggle that has previously seen him narrowly avoiding property auctions.
In an official announcement, Legacy Auctioneering Services has disclosed the impending auction of two vacant commercial properties, each spanning 0.36 acres, located in Murang’a County. The auction is scheduled for October 13, 2023, with these land parcels being held on a leasehold basis. Additionally, an industrial-cum-residential property covering a vast 15.6 acres in Meru County is set to go under the hammer on October 17, 2023.
Peter Munga, a prominent figure in East Africa’s financial sector, has previously experienced property auctions due to outstanding debts. In October 2017, he narrowly escaped the auction of his five houses in Nairobi’s Kasarani, valued at Ksh400 million ($2.72 million at the time), by making a last-minute payment to Jamii Bora Bank.
The current financial turmoil facing Munga is a result of credit facilities obtained by him and his business associate, James Karanja. These credits heavily relied on guarantees provided by their firms, Equatorial Nut Processors and Meru Ginnery, both of which own the assets now slated for sale.
Equatorial Nut Processors, one of the companies that guaranteed Munga’s loans in the upcoming auction, operates near Maragua town. Established in 1994, the company specializes in processing macadamia nuts, peanuts, and cashew nuts, employing over 1,000 workers.
Peter Munga is widely recognized for his extensive business portfolio, spanning various sectors such as agriculture, education, and insurance. Notably, he owns 72 million shares in Britam Holdings, making him one of the company’s largest shareholders. Additionally, he retains a minority stake in Equity Group Holdings.
Munga’s financial dealings have attracted significant attention in recent years. In 2021, a Mauritian commission of inquiry uncovered a secretive purchase of 452.5 million shares of Britam Holdings Plc from the Mauritian government, resulting in a reported Ksh3.9-billion ($35.9 million) loss for the country. The transaction, which occurred in 2016, sparked controversy due to allegations of undervaluation.
Competitors, including South Africa’s MMI Holdings and Barclays Bank (now Absa Group), had reportedly offered higher bids for the stake, each willing to pay Ksh11 billion ($101.24 million). Munga had initially promised to match this figure but eventually acquired the shares at a significantly lower price.
Subsequently, Peter Munga divested from Britam Holdings, selling 104 million shares in the open market in 2017, followed by the disposal of 348.5 million shares to the Zurich-based multinational Swiss Re in 2018. These transactions reportedly earned him billions of shillings in capital gains.