Court grants Twiga Foods legal relief in liquidation lawsuit

KENYA – Agritech firm, Twiga Foods, has successfully obtained a court order blocking the liquidation notice issued by Incentro Africa Limited, which sought to recover outstanding debts of approximately USD 261,879 (KES 39 million).

The firm owned by billionaire Peter Njonjo has obtained temporary orders to halt Incentro Africa Ltd from proceeding with the liquidation plan after moving to court immediately after being served with the notice in September 4^th.

Twiga informed Justice Josephine Mong’are that the liquidation petition was motivated by an ulterior motive. It was filed in retaliation after Twiga reached out directly to Google Ireland, the ultimate provider of the cloud services, to protest the way the billing account was entered, structured, and managed.

The head of legal at the agritech firm, Daniel Ngugi, stated that the demand was flawed as it had been presented prematurely.

Mr. Ngugi further stated that the demand made by the Google Cloud services provider was in bad faith and forced Twiga to settle a debt that did not exist.

“In the event that Incentro Africa is permitted to file and publish a liquidation petition, it will result in significant harm to the company. This is due to the false impression it will create among employees, business partners, bankers, creditors, partners, and the Kenya Revenue Authority that the company is insolvent,” he said.

Mr. Ngugi stated that any liquidation proceedings would result in cross-default for all of the company’s lenders, affecting all of its loan obligations that are currently being serviced.

Twiga is a business-to-business marketplace platform that sources produce directly from farmers and delivers it to urban retailers through a mobile-based cashless (B2B) supply platform. This allows for easy distribution to the millions of small and medium-sized vendors in urban markets.

According to Africa Business Insider, Kenya is the leading destination for agritech investments in Africa, with a projected value of $1 trillion by 2030.

Kenya’s food security challenges, as outlined in the report, have been a major factor in attracting investments to the agritech sub-sector. Twiga Foods and Apollo Agriculture are two of Kenya’s leading agritech startups, raising USD 80 million and USD 40 million, respectively, between 2019 and 2022.

However, despite the growth of the agritech sector in Kenya, there are still limitations to the widespread adoption of agritech solutions in Africa.

Among the challenges listed in the article are farmers’ lack of access to quality seedlings, fertilizers, and best farming practices, as well as the adverse effects of climate change.

“Many smallholder farmers are still unfamiliar with this new wave of development due to their limited education and reliance on traditional farming practices inherited from previous generations,” concludes the report.