Sh1b loan default puts leasing company Vaell under administration

Vehicle and Equipment Leasing Limited (Vaell) has been placed under administration after defaulting on creditors to the tune of Sh1.1 billion.

The administrator will now try to revive the company –which leases motor vehicles and other equipment— first before considering liquidation as a final option to help creditors recover their money.

The running of the firm that has been taken over by the Official Receiver in Insolvency, a semi-autonomous agency under the Office of the Attorney General.

"Take notice that the official receiver was appointed as administrator of the property of Vehicle and Equipment Leasing Limited, via a notice of appointment by the directors of the company with effect from 18th day of January,2024 pursuant to the provisions of the Insolvency act," the Official Receiver in Insolvency said in a notice dated January 23,2024.

Vaell had used computers, furniture, motor vehicles, machinery and heavy earth equipment worth Sh408.3 million as collateral.

The preferential creditors, who will be given priority in the payouts from Vaell’s cash flows or asset sales, include Kenya Revenue Authority which is owed Sh445 million according to the company’s statement of affairs seen by this publication.

Others are OikoCredit (Sh227.8 million), ABC Bank (Sh102 million), Consolidated Bank of Kenya Sh52.5 million), SBM Bank (Sh50.5 million), Co-operative Bank of Kenya (Sh46.4 million), Kingdom Bank (Sh39.5 million) and Spire Bank (Sh18.9 million.

Spire Bank closed operations after some of its assets and liabilities were acquired by Equity Bank Kenya Limited.

The secured creditors are owed a total of Sh994.1 million.