First Atlantic Bank Limited (FAB) has filed a petition at the Commercial Division of the High Court in Accra seeking the official winding up of Kenpong Travel and Tour Limited over what it describes as the company's inability to pay a court-ordered debt exceeding GH¢2.5 million.

The petition, filed under the Corporate Insolvency and Restructuring Act, 2020 (Act 1015), asks the court to place the travel and tour company into liquidation and order the realisation of its assets to satisfy an outstanding judgement debt.

The action marks the latest chapter in a long-running legal battle between the bank and the company, which is owned by businessman Kennedy Agyapong.

Insolvency claim

In court documents, First Atlantic Bank argues that Kenpong Travel and Tour Limited has demonstrated an inability to meet its financial obligations despite a judgement delivered in the bank's favour nearly four years ago.

The bank contends that the company is unable to pay its debts as they fall due and that the circumstances justify an order for its official liquidation.

According to the petition, Kenpong Travel was incorporated in October 2013 and operates in the areas of tourism promotion, ticketing, reservations and car rental services.

The bank further states that the company has an authorised share capital of GH¢1 million and a paid-up capital of GH¢60,000, with Mr Agyapong serving as sole shareholder and one of two directors.

Judgment debt

Court records cited in the petition indicate that First Atlantic Bank commenced legal action against Kenpong Travel and five other parties in 2019.

The High Court subsequently entered judgement against the defendants on August 15, 2022.

The bank says the judgement was later entered and amended, but despite numerous efforts to enforce it, the debt remains unpaid.

The petition identifies the outstanding debt as GH¢2,549,969.28, together with accrued interest at prevailing commercial rates and an additional GH¢20,000 in costs awarded by the court.

Multiple legal challenges

First Atlantic Bank alleges that since the judgment was delivered, Kenpong Travel and its associates have embarked on a series of legal applications aimed at delaying enforcement.

According to the petition, the company has made nine separate attempts to obtain stays of execution through various courts, including proceedings that travelled from the High Court to the Supreme Court on two occasions.

The bank argues that all the applications were unsuccessful and served only to postpone settlement of the debt.

It further claims that the company has failed to provide a credible repayment plan or acceptable collateral to secure payment of the judgment debt.

A significant aspect of the petition concerns the company's assets and financial standing.

The bank contends that inquiries into the company's assets have yielded little useful information and argues that Kenpong Travel has not demonstrated an ability to satisfy the debt.

It also alleges that documentation used in obtaining the original loan was found to be deficient to the extent that the Lands Commission could not register it as a mortgage.

The petition describes the company as presenting itself publicly as a viable business while, in the bank's view, being unable to honour its financial obligations.

Orders sought

First Atlantic Bank is asking the High Court to:

• Order the winding up of Kenpong Travel and Tour Limited under Act 1015;
• Direct that the company's assets be realised to satisfy the judgment debt and accrued interest;
• Restrain the company's directors from interfering with, disposing of or encumbering its assets pending determination of the case;
• Award costs; and
• Grant any further relief the court considers appropriate.

The case is expected to attract significant public and business interest given the prominence of the company and its ownership.

If the court grants the liquidation petition, it could lead to the appointment of an insolvency practitioner to take control of the company's affairs, assess its assets and liabilities, and oversee the process of settling claims by creditors in accordance with Ghana's insolvency laws.

The High Court is expected to hear the petition at a date to be determined by the Commercial Division in Accra.

As of the time of filing this report, Kenpong Travel and Tour Limited had not publicly responded to the winding-up petition.