A PROMINENT Kenyan service provider, Bandwidth Cloud Services Group (BCS), has lost control of its Zimbabwean subsidiary, Fiber Connections, following a legal dispute emanating from failure to pay a service provider more than US$1 million.
According to a court order issued by the High Court of Zimbabwe Commercial Division in case number HC595/24, the rights, title and interests of BCS Holdings Group in its Zimbabwean subsidiary, Fiber Connections, were seized and attached until the lawsuit against BCS Group has been concluded by the High Court or by the Supreme Court of Appeal, if the matter is appealed.
The order means that the 100% shareholding of BCS has been seized through legal attachment and is now under judicial control.
The sheriff of the High Court served the notice of attachment and seizure on the Deed Office, effectively encumbering the BCS Group’s 100% shareholding in its local subsidiary.
The dispute that has resulted in BCS losing control of its Zimbabwean subsidiary allegedly emanated from non-payment by BCS Group to one of its service providers, even though services were allegedly rendered.
According to summons lodged at the Zimbabwe High Court Commercial Division, on October 9 this year, the service provider, Leaning Tree, claimed US$1 035 636 plus interest from BCS Group and its Zimbabwe subsidiary Fiber Connections.
Copies of the sheriff’s return of service showed that BCS Group and its subsidiary were served with the summons on Monday October 14, 2024.
BCS is on an expansion drive across southern Africa, partially funded by Finnfund, a Finnish development financial institution.
- Kenyan firm loses control of Zim subsidiary
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The legal challenges may hamper further fund-raising efforts, especially as sources say they are courting the European Union Commission for grants and the European Credit Bank for debt financing for their expansion plan.
