Keystone Bank has seized control of Bacita Sugar Company, formerly known as Josepdam Sugar Company, following the failure of its current owner, KIA Africa Group, to settle a debt of ₦25,358,203,258.09. The bank has appointed Mr. Yunus Abdulsalam (SAN) as the Receiver/Manager to oversee the company’s assets.
This action stems from a Federal High Court order in Ilorin, which authorized Keystone Bank to recover its outstanding debt from KIA Africa Group, the entity that acquired Josepdam Sugar Company. The court has also frozen 21 accounts belonging to the KIA Group.
Justice A.O. Awogboro, the presiding judge, granted an ex-parte motion, instructing Keystone Bank to manage all of the company’s assets. The court ruling declared that the bank’s appointed Receiver/Manager is authorized to take possession, control, and manage all assets of the debtor company, secured as fixed and floating charges for the loan facility provided by Keystone Bank. The ruling also restrains KIA Africa Group from interfering with the Receiver/Manager’s control.
A Keystone Bank representative at the enforcement scene stated that the takeover was necessary to either manage or sell the sugar factory to recover the substantial debt. The bank obtained a court order directing the Nigeria Police Force to assist in the legal takeover.
KIA Africa Group had acquired Josepdam Sugar Company from the Assets Management Corporation of Nigeria (AMCON) and subsequently obtained loan facilities from Keystone Bank to facilitate the acquisition. The loan agreement included a 24-month repayment plan. To secure full ownership, KIA Africa also sought a bank guarantee from Keystone Bank, representing 75% of the balance purchase consideration payable to AMCON. This facility was granted on the condition that KIA Africa would deposit the company’s title documents with Keystone Bank upon receipt from AMCON and provide a personal guarantee from its Managing Director, Barrister Kenneth Irhiogbe.
However, KIA Africa failed to meet these obligations, contributing to the escalating debt. After exhausting all efforts to secure repayment, Keystone Bank, under its new CEO, Mr. Hassan Imam, initiated a debt recovery strategy, leading to the appointment of a Receiver/Manager.
KIA Africa Group had previously announced its acquisition of the sugar company in 2021, pledging to revitalize operations. The company cited its extensive land holdings, milling capacity, ethanol production plant, and skilled workforce as assets that would enable it to become a major player in the sugar industry. However, its failure to repay the loan has resulted in Keystone Bank taking control of the company’s assets.
