Ndere Cultural Centre, managed by Ndere Troupe Limited, found itself in a significant debt crisis, leading to the auctioning of its properties to recover a Shs 10 billion debt. In 2019, the organization secured a Shs 7 billion loan from Uganda Development Bank (UDB) to refinance a Shs 1.9 billion loan with Bank of Africa and to fund expansion projects, including the Obuntu Cuddle Hotel and Obuntu Lodge. However, the COVID-19 pandemic disrupted tourism and delayed the completion of these projects, forcing Ndere to request extensions and loan rescheduling.
Several issues worsened the situation. The company used substandard materials at the Obuntu Lodge, leading to additional costs, and changed the scope of the Cuddle Hotel project from 20 to 64 rooms without informing the bank. This breach of agreement, coupled with their inability to service the loan, led UDB to reject their request for additional funding.
Despite multiple meetings and offers of repayment plans from the bank, Ndere Troupe consistently failed to meet the terms. As a result, the cultural center’s properties were put up for public auction.
The proprietor of Ndere cultural center Steven Rwangyezi last week appealed to President Museveni to come and bail him out. However there are several other Ugandan companies that have closed due to failure to clear taxes and loans. Among these include but not limited to Wavah Broadcasting Services, Sembule Steel mills, Greenland bank among several other local companies.
The only local investor that has been at the magnitude of Ndere Center has been Mr. Bitature of Simba Telcom. Roko was also bailed out by government buying stake in the company. It is therefore likely for Ndere center to secure bail out from government by allowing the government take up stake in the company.
But this is not the real deal. What if there are people that are simply interested in Ndere center’s land? The company has prime land that is worth more than the loan upon which the bank is making the auction. There could be several people interested in Ndere center’s prime land.