Burugu– Controversial billionaire businessman Peter Burugu is in the spotlight once again, this time over the fraudulent take-over of the Regis School situated in the upmarket Runda Estate.
No stranger to controversy, Burugu had a long running battle with the East Africa Breweries Limited over beer distribution business.
Burugu’s alcohol distribution company Bia Tosha was for years locked in a legal battle with EABL over the local of lucrative beer distribution routes across Nairobi which culminated in the Supreme Court ordering EABL to reinstate Bia Tosha on the disputed routes in Nairobi, Machakos and Kajiado counties. Bia Tosha at the time handled nearly 12 percent of EABL products.
Burugu himself worked for EABL for over 27 years.
Back to the Regis School story.
Burugu is being accused of fraudulently and unprocedurally taking over the running of the high cost private school Regis School which was part of the Gems Cambridge Education.
Regis School officially opened in January 2020. The School operations were owned by GEMS Education (Based out of Dubai) while the land and buildings were owned by Runda Gardens LTD which is associated with Burugu.
As fate would have it, the Covid pandemic also struck in 2020 wreaking havoc on many businesses. Gems Education was no exception and it took a big hit.
Subsequently in 2021, Gems Education opted to sell shares to Ernestem Holdings, owned by a former GEMS Africa director Ernest Mureithi.
The move was to aid in keeping the operation afloat as the plans from GEMS Dubai at the time were to close all their operations in Africa (See Uganda and GEMS Cambridge Nairobi).
Unfortunately, the business-like others, was struggling to make ends meet and had to borrow to finance its activities and there were delayed payments to suppliers including the landlord Runda Gardens LTD.
A discussion and Informal agreement were reached to get a buyer for the land and buildings mainly as Burugu wanted to sell and perhaps also for the school operation if any buyer wanted it as a whole, as it would have been difficult to only sell the land and buildings.
However, Ernestem was not in a position to be able to purchase the land buildings at the time.
At the end of 2022, in mysterious circumstances, an agreement was purportedly reached to grant Burugu temporary management of the school operations as a buyer /investor was sought. It is claimed that this was to enable Burugu recover the money owed to him. (He had given a loan to the organization to fund salaries and the current quarter at the time outstanding rent.).
However, Burugu then took the opportunity to start a clandestine takeover of the school in somewhat unorthodox ways.
He has also acquired, in unclear circumstances, Ministry of Education licenses under his new brand but during the period of temporary management, meaning double registration of the same property.
The controversial tycoon let go of some staff members by refusing to take them on at the point of temporary management takeover and at the end of the same arrangement he has refused to contract others at the point of a forcible takeover at the end of the temporary arrangement.
He has also gone ahead to rebrand the school to a name that is almost similar to the original owned by GEMS/Ernestem.
There is a lot of speculation around this issue as the root basis or cause for this. Main reason being a reason to not pay any outstanding liabilities to creditors and staff prior to his taking temporary control as evidence by the letters and announcements made.
It is common knowledge that he has attempted to sell off the school under his “new brand” but so far hasn’t been successful.
There are matters in court by Ernestem holdings, creditors and staff on the same issue as per the below references: Some other creditors have opted to send complaints to the competition Authority for further guidance and assistance.
• HCCC/E266/2021: Anez Catering Company Limited VS Gems National
Academy Limited T/a Regis School Runda
• Hccomm/E726/2021: Soleca Developers and Construction Ltd Vs Gems
Cambridge International School T/A Regis School-Runda
• ELRCC/E351/2023: Terence Ndanyi AND Ian Gideon Kuria AND 1 Others VS
Gems National Academy Limited T/a Regis School, Runda AND Dr. Ernest
Mureithi Waithaka AND 2 Others
• ELRCC/E342/2023-Oduor Samuel Oketch & Others Versus Gems
National Academy Limited & Others
There are various letters written between the 2 main parties (Mr. Burugu and Dr. Mureithi) and to parents and staff that paint a full picture of the matter, with the main losers being the students (who may be affected by the fall out) the creditors (including the KRA) and the staff.
From the beginning of the year 2024 , Burugu has renamed and rebranded the school as “Regis Runda Academy Limited”. This is despite all the pending issues.