Zuku TV group wins Sh3.5bn Mombasa data centre case

28 April 2017

Mergers, Acquisitions and Financial Results

Wananchi Group shareholder East Africa Capital Partners’ (EACP) planned $3.5 million (Sh3.5 billion) data centre in Mombasa has received a major boost following a court ruling compelling the county government to grant the firm approvals for the project.

Justice Eric Ogola has ordered Mombasa County government to approve and stamp construction plans submitted by EACP to allow for the project’s take-off. Wananchi Group is the parent company for pay TV and Internet services provider Zuku.

Mombasa County had declined to stamp the documents after raising concerns about the identity of the firm behind the project.

EACP had submitted the documents for approval, but later shifted the entire project to its subsidiary, Kooba Kenya Ltd, which was incorporated in 2015. The county government also raised concerns about security and traffic congestion in the area.

EACP and Kooba CEO Richard Bell in suit papers claimed that the concerns raised by Mombasa County were vague, and that the delays to the project risked hampering investors’ projected returns of $17 million (Sh1.7 billion).

Mombasa County opposed the suit, arguing that it was filed by Kooba yet the building plans approvals were submitted by EACP.

The county government held that Kooba is a “stranger” to the project as its name does not appear in the building plans, and hence the suit should be dismissed.

But Justice Ogola ruled that Mombasa County should have dug deeper to verify why Kooba was pushing for approval of the building plans.

Source: Business Daily