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Kenya: Central Bank - Why Hotel Auction Wasn't an Option
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The Nation (Nairobi)
4 July 2008
Posted to the web 4 July 2008
Nairobi
The Central Bank could not sell the Grand Regency Hotel through public auction because it would have been unable to fix the best price.
The auctioneer could have sold the prime property at the fall of the hammer raising the possibility that it could have gone to any bidder deemed highest, an unsigned statement last night said.
The bank said private treaty would give it power to fix (Sh2.9 billion) which would reflect proper compensation.
The law also allowed the bank to sell the property by private treaty.
"This is the option the Central Bank found most advantageous," the statement said. This mode of disposal was also meant to protect the jobs of the 400 plus workers at the hotel.
Should resign
The statement said that Finance Minister Amos Kimunya and all relevant arms were kept informed. "A briefing was also made to the Prime Minister," it stated.
The statement gives details of the history of the hotel since 1993 and how it changed hands for the last 15 years.
Central Bank's head of legal affairs Abuga Kennedy Kaunda was in office yesterday despite a recommendation that he should resign alongside his boss Njuguna Ndung'u and Mr Kimunya.
Mr Kaunda is the Central Bank's director who signed as a witness in the controversial deal that transferred the hotel to the Libyan Arab African Investment Company (Kenya) Limited.
The committee that made the recommendation was led by Attorney General Amos Wako.
Not much is known about him, but the bank's director of human resources and services department, Mr Jones Makau Nzomo, described him as a competent lawyer. Efforts to get his comment Thursday were in vain as he was said to be attending meetings.
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His office, however, confirmed to the Nation that he had reported for duty and had several meetings lined up.
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