alexa Italian firm CMC di Ravenna strives to keep creditors at bay - Daily Nation

Italian firm CMC di Ravenna strives to keep creditors at bay

Wednesday May 8 2019

Itare dam

This photo taken on February 25, 2019 shows the site in Nakuru where Itare dam is to be constructed by CMC di ravenna. The company is fighting off a bankruptcy case. PHOTO | FILE | NATION MEDIA GROUP 

BRIAN WASUNA
By BRIAN WASUNA
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CMC di Ravenna, the Italian firm at the centre of the Sh20.5 billion Kimwarer and Arror dams scandal, has obtained a temporary order barring any of the 251 companies it owes money in Kenya from pursuing it in local courts.

Justice Francis Tuiyott issued the temporary orders after the company applied to have the bankruptcy case it has filed in Italy recognised as the main proceedings against it.

The company filed the application in a suit Barclays Bank filed against it, seeking to repossess 98 vehicles and equipment. The bank wants to auction the vehicles and equipment to recover a Sh595 million loan.

The Italian firm, which operates in 40 counties, wants the voluntary bankruptcy proceedings in Italy globally recognised as the main case involving it.

LOAN

The firm is being investigated by the Directorate of Criminal Investigations (DCI), which has discovered that it was paid Sh21 billion for two non-existent dams in Arror and Kimwarer in Elgeyo Marakwet County.

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The DCI and the Director of Public Prosecutions hold that 45 of the vehicles bought using the Barclays loan should be investigated.

The Rift Valley Water Services Board (RVWSB) has sought to join the case, claiming that it bought 17 of the disputed vehicles – 10 double-cabin pickup trucks and seven Land Cruiser Prados – for the stalled Sh28 billion Itare dam project in Nakuru County.

The RVWSB paid Sh82 million for the vehicles and now insists that CMC di Ravenna fraudulently used them as part of the security for the Barclays loan.

The board says the vehicles were to be registered in CMC di Ravenna’s name but handed over to it once Itare dam was completed.

BANKRUPTCY

But Barclays Bank disputes RVWSB’s argument, insisting that CMC di Ravenna approached the board for funding for the vehicles, which it (bank) had already financed.

Justice Tuiyott will today hear CMC di Ravenna’s application to have the case filed in Italy recognised as the main proceedings, which the bank has opposed.

The firm’s lawyers, Kidenda Onyango Anami & Associates, argue their client filed voluntary arrangement proceedings in Italy seeking to restructure its corporate debts to avoid bankruptcy.

The Italian court has appointed three administrators – Antonio Gaiani, Luca Mandrioli and Andrea Ferri – to study the firm’s assets and file a progress report, which will be used to determine whether to restructure its debts or declare it insolvent.

The firm’s lawyers argue that the proceedings in Italy are “a testament to the fact that the company’s business remains financially viable owing to the projects currently on its portfolio internationally, including the Itare dam project.