The life and times of billionaire businessman Stanley Githunguri

Former Kiambaa MP Stanley Githunguri. 

Former Kiambaa MP Stanley Githunguri and Lillian Towers in Nairobi. 

Photo credit: File | Nation Media Group

To say that Stanley Munga Githunguri was rich is an understatement.

Soon, after he was appointed the executive chairman of the state-owned National Bank of Kenya by President Jomo Kenyatta, riches, wealth, hubris, problems, and scandals followed in quick succession.

By the time he died this week, the list of his problems and the lists of his assets were at par. They included the iconic Lilian Towers along Nairobi’s University Way, Kiambu Road’s Ridgeways Mall, and court cases. Inside Lilian Towers, Mr Githunguri had a special seat at the bar. Here, he would entertain his guests with beer, wine, meat, and tales as they fondly cheered him on as “Mr Chairman.”

“A rich man's joke,” as British poet Thomas Edward Brown once said, “is always funny."

Some of these cheerers owed their riches to Mr Githunguri’s intervention. Others were subalterns and hangers-on from his Kiambaa backyard.

For Mr Githunguri, Lilian Towers was his signature project. Designed by Peter Derrick Thomas, the famous architect behind John Michuki’s Windsor Golf Hotels, Lilian Towers started with bad publicity. This was following the November 27, 1982 death of a University of Nairobi electrical engineering student, Stella Awinja Muka – by then a well-known actress in the theatre circles— after a falling object hit her from the 14th floor of the building.

Apparently, Mr Githunguri, or perhaps the City Council, had not relocated the bus-stop shelter underneath the construction site. It was only moved after her death. Following riots by the university students, police arrested two contractors, Valji Pinduria and Velji Patel, and charged them with manslaughter. But Nairobi senior resident magistrate T.T. Aswani ruled that the death was caused by “an accident” and that the prosecution had not proved that the director and supervisor were criminally negligent. “What happened does not amount to a crime against the state,” said Aswani.

Mzee Kenyatta's bigwigs

By this time, Mr Githunguri was still Mr Moneybags. Though he had been forced out of the National Bank as President Daniel Moi continued to prune Mzee Kenyatta’s bigwigs from the system, he must have counted his luck that he never faced a civil suit over Ms Muka’s death.

Born in Tanganyika in 1945, Mr Githunguri’s story is the story of African struggles in colonial Kenya and the making of an entrepreneur in a post-colonial state. His father, Munga wa Thaara, had abandoned his 10-acre farm in Kihara and taken his wives and 20 children to modern-day Tanzania as he sought a better life. Here, the young Githunguri was born in a sea of poverty.

Stanley Githunguri

Stanley Munga Githunguri and his family. 

Photo credit: Pool

But the Mau Mau emergency in Kenya in 1952, when Githunguri was only 7 years old, forced the British government to repatriate all the Kikuyus in Tanganyika back – fearing they could open new pockets of resistance. Upon his return, Mr Githunguri’s father was detained in Manyani and Lamu, where he became sickly and was only released in 1957 to go and die at home. He died in 1958 when Mr. Githunguri was only 13.

As a result, Mr Githunguri would be raised by his single mother, Lilian Nyagaki — the woman whose name is engraved in the history of Lilian Towers.

“I used to accompany my mother to pick coffee. We were paid 50 cents a tin and I would fetch Sh3 in a good day,” Mr. Githunguri once revealed to a reporter. One of the coffee estates was Nyali in Kiambu – now a residential estate.

Lilian would later enroll her only son in Gacharage Primary and later Karura Intermediate schools. He left in 1961 when hundreds of Kenyan students were airlifted to the US for higher education.

Githunguri was bright, and one of his teachers introduced the rural boy to an American priest who agreed to get him to an American college. Soon, the boy was on his way to St Mary’s High School in Alaska, where he had to brave the harsh weather. He later joined Yampa Valley College and Kansas Teachers College, where he graduated with a Bachelor of Arts degree in economics in 1967.

Soon after returning to Kenya, Mr Githunguri worked as a District Officer in Meru and Tana River before joining the National Bank of Kenya in 1968, first as a manager and later as the Executive Chairman.

Here he met power as he became Jomo Kenyatta’s banker. Occasionally, as the man handling Jomo’s bank accounts, he would be summoned to State House for various transactions. In one of these meetings, he managed to get a plot, previously allocated to Jomo, within a zone where the politically correct owned buildings or plots.

Soon, Mzee Kenyatta appointed him as the Executive Chairman of the National Bank of Kenya.

In the 1970s, Mr Githunguri’s word was a blank cheque. He was the chief recommender, nay intercessor, for Indian Ocean beach plots, and he would often write letters to Eliud Mahihu, the Coast Provincial Commissioner, who was the final word on who would acquire first-row beach plots.

Luckily, the letters are still secure in a government file, and they are the living evidence we have of how Kenyatta-era politicians and civil servants acquired so much wealth in the 1960s and 1970s.

Mr Githunguri would facilitate his friends to purchase beach plots and houses, and the National Bank would give out the loans. But the letters sent to Mr Mahihu were of personal nature – an indicator that there was more to the purchase than a bank-client transaction.

In one of the letters, he wrote: “I enclose for your recommendation and comments regarding plot No 1485 Sec 1 Mainland which is being purchased by your friend, Mr Kiereini of the Ministry of Defence. Please return the same to me.”

And when Mr Githunguri wanted to purchase some 1.16 acres from F.T. Nyammo’s Thammo Holdings in 1973, he literary left one of the copies in Mr Mahihu’s office, which has a note still attached that the original was “taken to the registrar of titles by Mr Githunguri himself on July 2, 1973.” The note is signed by Ellen Machau.

Another application that was taken to Mr Mahihu for approval, with Mr Githunguri’s endorsement, belonged to the spy chief James Kanyotu who was interested in a 1.93-acre beach plot. Kanyotu left a copy in Mr Mahihu’s office and took the original application with him to the Commissioner of Lands, Nairobi.

While the titles were processed by the Mombasa office of Registrar of Titles, Kanyotu did it in his own style. In a note to the Registrar of Titles dated September 1973 on the Mr Kanyotu and Mr Githunguri plots, Mr Mahihu wrote: “Please note that the original forms for the above plots were taken personally by the owners to Nairobi.”

That was raw power.

Mr Githunguri’s fall would start with the death of Mzee Kenyatta. In 1979, police stormed his NBK office and found some foreign currency. By then, it was an offence under the Foreign Exchange Act to hold foreign currency. Mr Githunguri was forced to record a statement, and as he underwent humiliation, he sought to resign. He then decided to develop Lilian Towers' plot.

To build Lilian Towers, Mr Githunguri approached Jimna Mbaru’s Jimba Credit Finance Corporation to finance the project as well as Industrial Development Bank. It was a blessing and a curse. As soon as the project was completed, Mr Githunguri turned it into the prestigious Nairobi Safari Club, an exclusive membership hotel, though one could still pay for temporary membership. The elegantly finished building had a unique design akin to a maize cob.

One evening in 1986, an Asian wheeler-dealer, Ketan Somaia, approached Mr Githunguri and offered to buy the hotel. Unknown to Mr Githunguri, the 24-year-old businessman was a front of Hezekiah Oyugi, a powerful permanent secretary for Internal Security. Both Mr Oyugi and Mr Somaia - who is now in jail in Britain over for defrauding British billionaire Murli Mirchandani of some Sh2.3 billion without any paperwork - knew each other. After all, Mr Oyugi’s father had been employed for many years as a “househelp” in Somaia’s family.

During this period, Mr Somaia was expanding his empire, which would soon include Miwani Sugar Factory and East African Marshalls, and he also opened a bank.

“The price was ridiculous,” Mr Githunguri would later say about the offer.

But not soon after he had rejected the offer, Mr Githunguri got the shock of his life after Jimba Credit recalled the Sh40 million loan failure to which they would sell the hotel. The letter was signed by Jimna Mbaru, as chairman, and had given Mukawa Holdings 21 days from July 31, 1986, to pay the loan or the financial institution would proceed to enforce its security.

Behind the scenes, the Central Bank of Kenya was threatening to close down Jimba Credit unless they regularised Mr Githunguri’s loans. They had noted that his borrowing and that of his companies exceeded the corporation’s share capital and reserves. As a result, Jimba Credit was said to have contravened the Banking Act, and the only option left was to recall the loan – or sell the property. Thus, unless Mr Githunguri brought his indebtedness down to Sh25 million, Jimna Mbaru’s empire was also troubled.

Somaia, perhaps Oyugi, were waiting for the sale.

The political intrigues of the mid-80s were staged in small painful doses. Rather than give in, Mr Githunguri decided to first negotiate with the bank, and it was agreed in a letter dated February 23, 1987, that he would pay the amount in two years. But on August 31, 1987, the corporation’s advocates, perhaps under pressure, sent a letter to Mr Githunguri and demanded immediate payment of Sh92,908,639 within 14 days. Apparently, the bank had consolidated two other loans given by Mr Githunguri and his Tassia Coffee Estate. The letter threatened that if payment were not made within the period, they would sell Lilian Towers.

 Mr Githunguri decided to stage a legal fight. But as he prepared, Jimba Credit was closed after the government asked the National Social Security Fund and other parastatals to withdraw from the institution. While Mr Githunguri would later say the property was worth Sh800 million – the High Court felt he was a master of exaggerations.

It would take Mr Githunguri three years in the court corridors as he battled to save a building that carried his mother’s name. Finally, he won and Justice C.B. Madan made his famous judicial remark: “Stanley Githunguri...Take this order. This Court gives it to you. When you leave here raise your eyes up to the hills. Utter a prayer of thankfulness that your fundamental rights are protected under the juridical system of Kenya.”

Many others cases would follow, including a battle with Mt Kenya Safari Club over trademark issues. But if Lilian Towers defined the Kiambu tycoon, it also gave space to negotiate his position and fight his battles. And they were many – and still, he has many unsettled battles and claims. And before he died, a battle over the control of his properties was already being fought in court.

In politics, Mr Githunguri learnt a small lesson. Money can buy a political seat – but not power. For in Kiambaa, he was viewed by some as the king of arrogance.

[email protected]. Twitter: @johnkamau