MAGOOOLA-EQUITY SH723BN WAR! Bank Tell Buyers to Ignore Legal Threat, Insist Matugga Pharma Plant, Luzira Milling Factory & Other Properties Sale Will Proceed
KAMPALA — Equity Bank Uganda and Equity Bank Kenya have dug in their heels over the planned auction of properties belonging to businessman Dr Matthias Magoola’s companies, dismissing a legal warning issued to prospective buyers and insisting that the sale will proceed.
The two banks, through their lawyers Katende, Ssempebwa and Company Advocates, have told the public to ignore a November 9, 2026 notice by Muwema and Company Advocates cautioning buyers against participating in the proposed sale.
In a public notice titled Response to Caveat Emptor, the banks’ lawyers maintained that the auction is lawful, is being conducted under the Mortgage Act, and is not in contempt of any court proceedings.
“We are writing to confirm to the public that the said public auction is proceeding under the auspices of the Mortgage Act, Cap 239 Laws of Uganda and is legal and lawful and not in contempt of any court proceedings,” the lawyers stated.
They further insisted that no court had issued an order stopping the sale.
“We also confirm that there is no order of any court staying or stopping the proposed sale,” the notice added.
The banks’ firm response sets the stage for a potentially explosive showdown over the properties, with the lenders urging buyers to proceed while Magoola’s legal team warns them to keep off.
The dispute follows a November 5 advertisement by JALD (U) Ltd announcing the intended disposal, through public auction or private treaty, of several properties mortgaged as security for loans advanced to Dei BioPharma Ltd and Dei Industries International Ltd.
The properties listed include the pharmaceutical manufacturing establishment at Matugga, a wheat milling plant in Luzira and other commercial, industrial and residential properties in Kyamuli-Kungu, Katwe, Muyenga, Kitende and Seguku.
The Matugga establishment, associated with Dei’s pharmaceutical manufacturing project, sits on approximately 20.673 acres and is among the high-profile assets caught up in the dispute.
But the proposed sale has triggered a fierce legal disagreement over the outstanding loan balances and the process used to determine how much the Dei companies owe the banks.
Through Muwema and Company Advocates, Magoola and the companies have argued that the auction is premature because the debt remains contested and court proceedings relating to the loan audit have not been concluded.
The companies have previously questioned the independence and integrity of the audit process intended to establish their actual obligations to the lenders.
The dispute escalated after the Court of Appeal reportedly issued an order on September 9, 2026 staying proceedings in the underlying High Court matter pending determination of an appeal concerning the contested audit process.
The banks, however, now maintain that the order does not stop them from exercising their rights under the mortgages securing the loans.
That position puts the two sides on a collision course, leaving prospective buyers confronted with competing legal warnings over whether to participate in the planned transaction.
The controversy has also attracted wider public interest because of the Government’s reported investment of Shs723.4 billion in Dei BioPharma, which is developing a pharmaceutical manufacturing facility at Matugga.
The Parliamentary Committee on Presidential Affairs has previously raised questions about accountability, operational performance and documentation surrounding the Government’s investment in the company.
With the banks insisting that the auction is lawful and Magoola’s lawyers warning buyers against taking part, the fate of the properties now hangs over an increasingly bitter financial and legal battle.
For prospective buyers, the competing notices present a high-stakes decision: the lenders are inviting them to participate, while the Dei side is warning that the sale is being pursued before the underlying loan dispute is resolved.
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