Court allows Stanbic Bank to auction Convex refinery assets

Athi River-based edible oil refinery owned by Convex Commercial Logistics is set for auction to recover a Sh2 billion debt owed to Stanbic Bank, after the company defaulted on a loan acquired to establish the plant.

The lender, through Garam Investments Auctioneers, has invited bids for the sale of the factory and land situated within the Export Processing Zone (EPZ) in Machakos County.

The property includes a newly built edible oil processing plant on two land parcels measuring 25 acres, alongside machinery and storage facilities. The auction is scheduled for September 9, 2025.

This follows a High Court decision in June that granted Stanbic Bank approval to dispose of the property.

Justice Alfred Mabeya dismissed Convex Commercial Logistics’ plea to halt the auction, saying the company had not provided sufficient evidence to prove its claims of delayed loan disbursements by the bank.

Through its representative, James Waithaka, Convex and its affiliate Convex Commodity Merchants Limited told the court that they had secured Sh500 million in financing from the Kenya Development Corporation to complete and commission the refinery. They further disclosed that they were negotiating a $18.4 million (Sh2.37 billion) deal with US-based Ethos Asset Management Inc. to take over the facilities.

The two companies argued that this information had been communicated to the bank, but the lender continued with plans to recover its money through an auction.

They had sought a court order to restrain the bank and its agents from interfering with their assets, which included the edible oil plant, machinery, and the two land parcels.

Justice Mabeya, however, ruled that there was no proof the firms had formally applied for the alternative financing, nor evidence of any imminent disbursement.

He concluded that the balance of convenience favoured the bank’s right to recover the debt, noting that the borrower had defaulted.

The company attributed its financial troubles to the Covid-19 pandemic and delays in loan disbursements, which it claimed hindered the timely completion of the project.

Convex had borrowed Sh1.5 billion from Stanbic Bank in December 2020 for the refinery project and later sought further financing for its completion.