Businessman Patrick Bitature has given further details on the ongoing dispute between his business empire (Simba Group) and South African fund, Vantage Capital.
In an open letter released on May 30, Bitature said the last few days have been quite challenging to him, his family, colleagues, business partners, staff, and other Simba Group stakeholders.
“Ugandan media has recently been awash news reports about members of the Simba Group,” he said, noting that the attacks against Simba Group are an affront to the economic prospects as they inhibit the capacity of local entrepreneurs to exploit local and international opportunities.
According to him, the woes his company is facing, stem from business expansion plans when Simba approached Vantage Capital in 2014 seeking an alternative to the more common and mainstream pure debt funding for business expansion.
He said the “Mezzanine Term Facility Agreement” (MTFA) was signed between Vantage Mezzanine Fund II Partnership (“Vantage”) and Simba Properties Investment Company (Simba) for $10,000,000 to fund projects within the Group.
“These projects included the completion of Protea by Marriott Skyz Hotel and working capital for our ElectroMaxx Power subsidiary,” he said, adding, “The agreement had a 3-year moratorium (freeze) for repayment of both the principal and interest.”
Bitature revealed that Simba was confident of the economic prospects in the country as Uganda had discovered 6.5 million barrels of oil reserves.
“Like many other business players in Uganda, we were expecting an economic upturn, and therefore in line with our innovative plans, ground-breaking and forward vision, we explored opportunities to generate value in the economy through sustainable investments. As one of the leading Ugandan business Group with a credible track record, we were well-positioned to harness this financing opportunity in order to grow and create more jobs and value for the nation,” he said.
He, however, noted that following the signing of the Mezzanine facility in 2014, the first redeployment was due in 2017 but unforeseen challenges such as; the unprecedented delay of the Final Investment Decision (FID) on the oil and gas projects and Vantage’s requirement to Simba to improve the Hotel’s fire and safety features to internationally benchmarked standards, hindered the envisaged projects.
Bitature says they proactively engaged Vantage and mutually agreed to a further moratorium for two (2) years, thereby mutually agreeing to freeze all payments until December 2019.
“In December 2019, Vantage issued a demand for the principal and interest from 2014 onwards and by early 2020, the said amount had increased. With the effects of COVID-19 on the business and the economy, we were once again faced with great business challenges. Vantage, nevertheless, attempted to realize their security over the prime assets of Simba.”
There have been several rumours and attacks made against me and The Simba Group Of Companies on both social and mainstream media stemming from the Vantage Loan Saga.
In this open letter, I share my truth as to what truly transpired. pic.twitter.com/G8BeoK0NK2
— Patrick Bitature (@patrickbitature) May 30, 2022
