KAMPALA, Uganda — Simba Group, led by prominent businessman Patrick Bitature(In Photo above), received a temporary stay of execution from the Supreme Court on Thursday in its high-stakes dispute with South Africa’s Vantage Mezzanine Fund II Partnership over a $10 million (35 billion shillings) loan.
Justice Elizabeth Musoke, sitting as a single justice, issued an interim order halting the enforcement of an August Court of Appeal ruling that had cleared the way for Vantage to seize mortgaged assets and enforce the loan agreement.
The dispute stems from a 2014 facility extended by Vantage to Simba Properties Investment Co. Ltd., with guarantees from other Simba Group entities and personal guarantees from Patrick and Carol Bitature. The loan was secured against prime real estate and equity holdings.
Following an alleged default, Vantage pursued arbitration under the London International Chamber of Commerce (ICC), securing a final award in its favor in July 2023.
In granting the temporary relief, Justice Musoke dismissed Vantage’s arguments that there was no imminent threat of enforcement, stating that it was a “reasonable inference” that any successful party would have an interest in “immediate execution of the decree.”
“I find incredible the suggestion… that the lenders do not have any intention to imminently execute the decree,” she wrote in her ruling.
The interim stay offers a crucial “breathing space” for Bitature’s empire, which spans telecommunications, hospitality, and real estate. Bitature has previously argued that COVID-19 restrictions severely impacted his companies’ cash flows, hindering their ability to meet repayment timelines.
The ongoing legal battle is being closely watched by the international investment community as it underscores the tension between foreign private equity and mezzanine financiers and local corporations in East Africa. The ultimate Supreme Court decision will set a key precedent for Uganda’s arbitration framework and its attractiveness to cross-border lenders.
“The main purpose of an interim order is preservation of the status quo to avoid rendering nugatory the determination of the substantive application for stay of execution and the appeal itself,” Justice Musoke wrote.
