A Kenyan court has halted the Bank of Baroda from placing the Infinity Industrial Park under administration. Justice Freda Mugambi ruled that the bank could not rely on an alleged Sh2.07 billion debt claim against Infinity Industrial Park. The court found that Infinity had a substantial claim against the bank, which invalidated the debt as a basis for administrative action.
The decision came after Infinity Industrial Park challenged the bank’s attempt to restructure its debts through administration. The court emphasized that the bank’s claim lacked sufficient legal standing. Infinity had previously alleged that the bank had failed to meet its obligations under a loan agreement.
The ruling has significant implications for corporate debt restructuring in Kenya. Legal experts say the decision sets a precedent for how banks must prove their claims in similar cases. The case highlights the importance of verifying the validity of debt claims before initiating administrative proceedings.
The court has ordered the Bank of Baroda to reconsider its approach to the matter. The case remains under review, with further legal steps potentially following.
