Businesswoman Mary Wambui Mungai has lost her bid to remove the administrator Equity Bank appointed over her luxury Glee Hotel, after the High Court ruled the bank had lawfully exercised its rights as a secured creditor in a dispute over a debt whose actual figure remains contested, with Equity Bank placing the figure at Sh9.1 billion and Wambui’s side maintaining it stands at Sh7.75 billion.
Justice Freda Mugambi on Thursday dismissed an application by the hotel’s management challenging the appointment of Kamal Anantroy Bhatt as administrator and seeking to restore control to its directors.
The court held that Equity Bank, holding a qualifying first-ranking floating charge over the property, had appointed Bhatt in accordance with the Insolvency Act, and that Wambui’s claim that she could still secure alternative funding did not override the lender’s right to recover what it was owed.
The judge also restrained the company’s directors and agents from interfering with the administrator’s work, disrupting hotel operations or dealing with its assets, and directed the officer commanding the Runda Police Station to provide security to ensure the order was complied with.
The court rejected the argument that administration should only be used as a last resort where a lender holds other forms of security, ruling that a secured creditor is entitled to choose whichever lawful recovery mechanism it considers most appropriate.
“A duly appointed administrator may only be removed for cause, and the burden of proving sufficient cause rests on the party seeking removal,” the court said.
Glee Hotel had argued that Equity failed to disclose relevant court proceedings and other information in the statutory documents used to place it under administration, that the bank should have pursued its other securities first, and that administration was disproportionate given the value of assets already securing the debt.
The court found none of these arguments persuasive, ruling that Equity had complied with Part VIII of the Insolvency Act, had furnished the required statutory declarations, and was under no obligation to detail every default, judgment debt or related court proceeding in those documents.
The judge further noted that the company had signed the relevant security instruments fully aware of their contents and legal effect, and that the mere existence of alternative security did not mean pursuing it would have produced a better recovery for the bank.
Justice Mugambi also raised concerns about conduct since the administration began. She noted resistance to handing over critical information to Bhatt, including passwords, and found that Sh23 million had been transferred out to Workright East Africa Ltd without the administrator’s approval.
- Equity Bank takes control of Glee Hotel in Sh7.8bn debt battle
- Tuju fights to save his crown-jewel Karen property from auction
- Court approves NBK auction of Nairobi Upper Hill Hotel
The judge described the payment as an act of mischief, holding that it interfered with both the administrator’s authority and the statutory order of priority among creditors. On the other side of the ledger, the court found evidence that Bhatt was making genuine progress toward rescuing Glee Hotel as a going concern, the primary objective of administration under the Act; Bhatt told the court he had engaged a marketing consortium and contracted World Travel Group UK Limited to drive up bookings at the property.
The dispute traces back to October 30, 2020, when Wambui secured a Sh3.5 billion project finance loan from Equity, which she said was intended to refinance Sh2 billion in existing borrowing and complete the seven-star-rated Glee Hotel, spa and convention centre along the Northern Bypass off Kiambu Road.
The facility was secured through an extensive web of collateral and guarantees spanning Wambui’s wider business interests. Properties held by Purma Holdings Ltd were pledged to secure borrowing for both Glee Hotel and Albatross Aviation Ltd, including Shelter Pride Apartments near Safari Park Hotel, valued at Sh240 million, and a separate Purma property used to facilitate borrowing by Albatross and Glee.
She later offered a property on Mogotio Road in Westlands as collateral for a Sh1 billion facility benefiting Glee and Purma, and, through a deed of variation, pledged a further property to facilitate an increase in that loan to Sh3 billion.
Wambui also issued personal guarantees of Sh22.5 million and Sh180 million, secured against properties in Ngong, along with a Sh46 million property in South B, all used to secure Glee’s loan.
A further Sh3 billion company guarantee was issued through the Purma Group of Companies, covering Purma Holdings, Charma Holdings, Enterprise Supplies, Haven Park, Albatross Aviation, Glee Hotel, Njest Supplies, Evertec General Trading and Daydots Ltd.
Wambui and her daughters, Purity Njoki and Nyambura, added personal guarantees and indemnities for the Sh3 billion facility, and Wambui separately pledged her Kiambaa property, along with 21 apartments in Thindigua, Ruiru, valued at Sh3.6 billion, while offering her companies as cross-default guarantees.
According to court documents, Wambui maintains that she has paid Equity at least Sh2.5 billion toward the principal and a further Sh997 million in interest. She says the bank demanded roughly Sh7.4 billion from Glee on October 6, 2025, and instructed valuers Tysons Ltd to assess two parcels of land registered under the hotel.
In response, she proposed that Kenya Commercial Bank take over all facilities operated by Glee, Purma Holdings, Enterprise and Albatross, saying the companies had secured a syndicated loan that would have allowed Glee to clear its debts by January and March 2026.
She also indicated she could raise Sh7 billion, roughly 85 per cent of what Equity was demanding, to settle two Glee accounts, two Enterprise accounts and one belonging to Albatross. Equity responded on November 20, 2025, setting out conditions, including a detailed payment proposal for accepting the proposed settlement.
The High Court’s ruling has left Bhatt firmly in control of the hotel after Wambui’s latest attempt to remove him failed on every ground raised.
Email your news TIPS to Editor@nairobilawmonthly.com, and to advertise with us, call +254715061658 anytime of the day
