Parliament Wants Asian tycoon Probed Over K’la Schools Land

A parliament report has recommended an investigation into city tycoons over allegations of grabbing Kampala Schools land.

And top on the list is a controversial international businessman of Canadian origin, identified as Mahmoud Bharwani.


A parliament select committee report on city schools’ land grabbing chaired by Robert Miggadde (Bukuvuma) released last month has unearthed how a private company owned by Bharwani colluded with officials from the defunct KCC and the Ministry of Education to take over land belonging to Nakasero Primary School in Kampala.

Prestigeous Apartments Limited, whose directors are listed as Ephraim Ntaganda and Bob Kanaabi, both well-connected city businessmen is also under probe. Prestigious, according to the report was incorporated on August 5, 2010 in Kampala.

Three days later, the company wrote to Kampala City Council, the authority that was then in charge of the city, expressing interest in developing Plot 34A Kyadondo Road and 5C Mackinnon Road.

The prime plots are in the heart of the city, located next to the lush green leafy compounds of the rich and famous. State House Nakasero is not too far away; the British High Commissioner’s residence is within spitting distance.

KCC okays deal

Less than a week later, on August 13, 2010, an education officer in the then KCC, Ms Night Alice, wrote back to the firm. “This is to inform you that the division department of education, under which this school falls, has no objection to your intensions of acquiring this piece of land from ULC.”

Under existing regulations, the school authorities should have been consulted about the plans to acquire a lease over land that had, in effect, been set aside for their use or future expansion.

NAMED; Bharwani
NAMED; Bharwani

Instead, the process continued with the school kept in the dark. The forces behind Prestigeous Apartments then lodged a request with the Uganda Land Commission (ULC), the custodian of public land, to acquire a lease and develop the said prime plot.

The reply came only a day or two later. ULC secretary, K.S.B Mubbala, wrote to the Education ministry’s permanent secretary on August 16, 2010, informing them of the developer’s intensions.

Only two days later, there was a reply. A letter, whose authenticity is the subject of investigation, and bearing the signature of a one John Agaba, as acting permanent secretary, replied indicating a no-objection: “This is to inform you that my ministry has no objection to your intended plans to allocate the land in question.”

On October 29, 2010, less than three months after Prestigeous Apartments was incorporated, it received a lease over the 0.657 hectares of land from the Uganda Land Commission. The school had no idea part of its allotment had been sold.

As quickly as the company had come onto the scene, it now started going through changes in structure and ownership, a sleek corporate shedding its reptilian skin.

Three days before the lease was issued, the shareholders; Ntaganda (65 per cent) and Kanaabi (35 per cent) had accepted the transfer of all shares and approved the purchase offer by Mahmud Bharwani and Ms Shaida Bharwani at Shs200,000 per share, according to filings at the company registry.

Company changes

More changes were to follow. Four days after Bharwani and Ms Bharwani were appointed new directors of the company on January 17, 2011, a one Shamira Muhammed Asim then replaced the duo, as ownerships and directorships continued to change.

Bharwani, on March 03, 2011 resolved that the company guarantee a Shs3bn overdraft facility from Crane Bank Ltd in favour of M/S Bravia Holdings Ltd. A mortgage of the said sum was then registered on the land to secure the overdraft.

With the land now secured, the company finally approached the school.

Ntaganda, who would not be re-appointed as a director for at least another month, wrote to the school on April 19, 2011, expressing interest in the land, six months after his company had been granted a lease over it.

Another deal

This is not all! Bharwani is also linked to a controversial deal involving Milton Obote Foundation (MOF) in which the directors claim have lost billions of shillings.


MOF planned to expand Uganda House on Plot 8/10 Kampala Road to enhance its revenue.

Ignatius Barungi, the chairman of MOF Board of Governors, gives impressive figures to bring their dream to life.

The plan was to invest at least $11.5m in the project to increase the available rental space by 77%. This was projected to increase rental income by a monumental 273%, from $926,723 to $3,453,729 per year.

Having failed to secure a loan within Uganda, Barungi contacted Shelter Afrique, an intergovernmental lending agency in Nairobi, Kenya.

Armed with the project feasibility study by the reputable PKF firm, they were confident to get the loan from Shelter Afrique.

Barungi and Terence Ayepa, MOF’s acting corporation secretary and general manager, are armed with their correspondences with Shelter Afrique and other relevant documents.

Shelter Afrique’s lending policy does not allow the company to singly finance such projects. Therefore MOF, which was borrowing through Uganda House Investments Ltd (UHIL), one of its companies, would have to contribute a substantial part of the required loan for co-financing.

Shelter Afrique would provide $9m and MOF/UHIL would contribute the balance of $2.5m. Of this $2.5m, MOF/UHIL, Barungi said intended to raise $1m from rental security deposits paid by tenants at Uganda House, while the remaining $1.5m was to be borrowed.

But because the $2.5m was supposed to be MOF/UHIL’s contribution to the project, Shelter Afrique would ideally not expect it to have been borrowed.

Indeed, MOF/UHIL did not inform Shelter Afrique that the Shs3.9b, which was at the time of borrowing equivalent to $1.5m, had been borrowed from Mahmud Bharwani.

The story of Bharwani lending Shs3.9b to MOF is almost one of not lending at all. He asked MOF to open a fixed deposit account in Diamond Trust Bank, his bankers, on which the borrowed money would be deposited.

The condition was that MOF would not withdraw it without his consent. Some MOF board members wonder whether they were lent any money at all. And some of the board members did not know it until much later, and they found out by accident.

A board member suspects it is because of the restrictive condition on the money, which Shelter Afrique later learnt about, that Shelter Afrique eventually changed position and refused to lend to MOF. In any case, how would MOF use the Shs3.9b it claimed to have as equity contribution when the money was under a caveat?

Indeed, the money had been borrowed for just one year after which it would be repaid to Bharwani.

However, some MOF board officials accuse him of conniving with some members of MOF to cause financial loss to the company.

There are queries on how the loan he advanced to MOF was cleared and some board members say the loan agreement was doctored in Mr Bharwani’s favour.

With the MOF Board split over the matter, an internal investigation led by former Chwa County MP and board member, Livingstone Okello-Okello, was set up. The other members were Faustino Orach-Meza and Prof Patrick Rubaihayo.

Their report of February 9, 2014 titled: “Irregularities associated with sourcing of $1.5m as equity fund for the Plot 10, Kampala Road Project” was adopted by the board on February 26, with four members voting in favour and three against it.

The committee found that sections were “smuggled” into the board minutes of July 18, 2013, by which the board was deemed to have cleared the borrowing from Bharwani and Shelter Afrique and pledging MOF’s properties to secure the loans.

The “concocted sections” in the board minutes, the committee said, were used to formulate subsequent resolutions clearing the borrowing of Shs3.9b from Bharwani, opening a fixed deposit account in one bank in the name of MOF and mortgaging MOF’s property to secure the loan.

The report further noted that MOF did not have an original copy of the loan agreement they signed with Bharwani, and that the committee only received it from him on request.

Whereas the agreement provided for the loan interest to be paid in two equal installments of 4.5 %each, the committee noted the whole amount was paid to Bharwani in advance.

“There is no documentary evidence to explain this change of terms of the agreement,” the report noted, adding: “There is no evidence of participation of the MOF company lawyers in drawing up the agreement.”

Bharwani, who has offices on a building in Industrial Area which is owned by MOF, has a long history with the Foundation but some of the board members want the organisation to stop dealing with him.

One of the recommendations of the report says: “All efforts should be made to delink MOF and all its subsidiaries from Bharwani and all companies and groups where he has interest.”

According to MOF directors, it is because of this bad deal that culminated into the closure of Uganda house a few weeks ago.

KCCA closed Uganda House over failure to renovate the building; fixing broken pipes, drainage systems, rusted plumbing fittings, exposed electrical fittings, maintenance of frontages, and painting among others.”

Who is Bharwani?

Bharwani is a controversial international businessman of Canadian origin.  He owns several companies that include Quick Color print on 5th Street industrial area.

Most of times he is Canada but his business associates are mostly women from Uganda, Europe, Kenya and Dubai. He is linked to several deals involving public land in Kampala and parliament wants all investigating arms of government to look into the transactions, with the possibility of reclaiming the respective public schools land.