Zambian business magnate sues Atlas Mara over bank sale deal

A ZAMBIAN business magnate has sued Atlas Mara accusing the Virgin Islands-based banking group of failing to honour its payment commitment over an eight-year-old deal.

Rajan Mahtani who set up the Finance Bank of Zambia in 1986, agreed to sell the lender to Atlas Mara in 2015 for $215 million (about £169.42m by the current exchange rate).

However, Mahtani and others brought a lawsuit in London’s high court alleging they had received less than a quarter of the consideration.

They claimed that Atlas Mara, co-founded by former Barclays chief executive officer Bob Diamond and the Rwandan-based entrepreneur Ashish Thakkar in 2013, breached a share and sale purchase agreement drawn up in November 2015 for the Zambian bank.

According to barrister George Spalton KC who represented Mahtani, only about $60m (£47.28m) of the sum was paid upfront in cash and the remainder was linked to various conditions, including the successful raising of funds following the acquisition.

In his written submission to the court on Wednesday (22), he said Atlas Mara made “it as hard as possible” for the Zambian lender “to meet thresholds at which they would be paid”.

However, Atlas Mara’s lawyers denied the allegations.

They said, “The present claim forms part of an observable pattern of behaviour by Dr. Mahtani, by which he repeatedly seeks to benefit himself by unreasonable demands, threats, and continual attempts to re-open and renegotiate the terms of deals which he has done.”

Mahtani is the chairman of Mahtani Group of Companies which operates in various sectors including finance, cement and housing.