Contractor files for bankruptcy
Kampala. The Italian firm lined up to take the Shs500b contract for work on the Busega-Mpigi Expressway has filed for bankruptcy in Italy.
Co-operativa Muratoi e Cementisti Di Ravenna (CMC Ravenna), one of the partners in the joint venture with Advent Construction, had emerged front-runners in the race for the contract following clearance by the African Development Bank (AfDB) last week.
“We are pleased to inform you that we have no objection to your recommendation to award the contract for the construction of Busega-Mpigi Expressway to M/s C.M.C Di Ravenna in JV with Advent Construction Ltd, Via Triesca n. 76; 48100, Ravenna (Italy) for the sum of Shs501b,” wrote the Bank’s Regional Operations Manager for Infrastructure, Private Sector and Industrialisation, Mr Hussein Yusuf Iman.
The bank’s communication should have in effect served to end the fights and controversies that have plagued the project, which will entail expansion of the 23.7km stretch from two to four lanes, the creation of four major exchanges at Nabbingo, Nsangi, Maya and Lugala and construction of several service roads and auxiliary lanes.
However, it is emerging that CMC Ravenna has filed for bankruptcy in a court in Ravenna just a week before AfDB issued the no objection to Unra.
This new development now raises serious doubts about the firm’s ability to raise operational capital to work on the project and its ability to deliver within the planned time line.
Mr Allan Ssempebwa Kyobe, the media officer in the office of Unra executive director Allen Kagina, was quick to allay fears that the contract will be handed out to cash-strapped contractors.
The website, www.globalcapital.com published an article, ‘Distressed CMC Ravenna stokes HY’s Italian fears,” in which it reported that the company had chosen to go for debt restructuring under the insolvency laws of Italy, a move which would protect the firm from its creditors.
It was not possible to talk to CMC Ravenna as it has no registered office in Kampala.
However, Mr Kyobe said communication has always been online.
