Trader faces bankruptcy over bus deal

Mr Guleid Kunow Mursal shows journalists one of his Diamond Coaches Limited buses currently held at an auction yard awaiting sale by First Community Bank to recover a loan. The buses were to be deployed on city routes. PHOTO | JEFF ANGOTE

What you need to know:

  • The county government was to offset the Sh39 million bank loan balance in three equal instalments, documents show, for the partnership to be cemented
  • Mr Ondieki said the deal was no more and that Mr Mursal was just one of the many people and firms that submitted proposals for the transport contract

A supposedly lucrative deal has left a businessman staring bankruptcy in the face as the Nairobi County Assembly ordered investigations into the matter.

For transport company owner Guleid Kunow Mursal, 37, the adage that when the deal is too good, then think twice, could as well have come to pass.

Only  six months ago, his bus company — Diamond Coaches Limited — was raking Sh20 million a month out of which it diligently paid Sh1 million to First Community Bank that had financed the purchase of his fleet of buses that plied Nairobi-Mombasa and Nairobi-Garissa routes.

This was until he got an offer from the Nairobi County Transport Executive Evans Ondieki.

“To help address biting public service transport in the city, I was told to sell the company to the county government where they would own 51 per cent and me and my associates 49 per cent,” says Mr Mursal as he produced documents to back up his claims.

The county government was to offset the Sh39 million bank loan balance in three equal instalments, documents show, for the partnership to be cemented.

But somewhere along the way, the county government  did not fulfil its promise to the bank. “The bank became impatient with the City Hall deal after I failed to remit the Sh1 million monthly. It is now three months overdue,” says Mr Mursal.

The bank moved in and seized 10 of the buses. They are now kept under lock and key at an auction yard on Kitui Road in Industrial Area, Nairobi.

Mr Ondieki said the deal was no more and that Mr Mursal was just one of the many people and firms that submitted proposals for the transport contract.

WE HAVE MANY PROPOSALS

“Diamond wrote a proposal to the governor like any other stakeholder. We have so many proposals, most of them international,” says Mr Ondieki.

He says the Diamond issue was different from the rapid bus transport system that is designed to introduce big capacity buses in major city routes. Other firms interested in the deal are VDL, Volvo, Leyland and Foton East Africa.

Last Tuesday, the matter landed at the County Assembly which set up a committee to investigate the botched city buses deal.

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