$35m loan: UBA files winding up petition against Sahara Energy

A legal battle has begun between United Bank of Africa and Sahara Energy Resource Limited over an unpaid loan the bank claimed was guaranteed by Sahara.
UBA Plc filed a winding up petition against it at a Federal High Court in Lagos.
According to ‘The Cable’, the petition was based on a N15 billion loan owed by KEPCO Energy Resources Limited (KEPCO), with Sahara Energy said to have stood as a guarantor to KEPCO.
The petition was filed before Mohammed Liman, a judge of the high court, by Temilolu Adamolekun, UBA’s legal counsel.
The bank said KEPCO had through a loan, raised capital to fund the acquisition of Egbin Power Plant, operated by Sahara Power Group, a privately-owned power company under the Sahara conglomerate.’
‘The Cable’ adds that in 2013, the Federal Government granted KEPCO, a Korean company, 70% stake of Egbin power plant at a sale value of $407.3 million, which was equivalent to N64.35 billion at the existing exchange rate.
In order to fund that acquisition, the petitioner said KEPCO had applied for a credit facility from several banks, including UBA, with Sahara Energy standing in as a “corporate guarantor” to secure the loan.
But Sahara Group has denied being indebted to UBA, saying it neither had outstanding facilities with the bank nor did it borrow any money from UBA.
The firm added that it did not grant a direct guarantee to UBA on any loan transaction that UBA
could unilaterally enforce or sue on.
“Our lawyers have been duly instructed and have taken all necessary steps to ensure that the order is discharged or set aside as soon as practicable,” Sahara Group said in a statement.
“Sahara Energy Limited (SERL) and the entire Sahara Group will vigorously pursue and defend UBA’s petition to its logical conclusion with a view to dismissing the petition.”
The hearing of UBA’s petition has been adjourned till April 30.