Mahadi Energy Limited has sued in the High Court to stop Premier Bank from selling its properties in Nairobi and Mombasa over a claimed loan of Sh631 million. The firm says the loan was issued under Islamic Sharia laws and it has paid over Sh530 million, but the bank has not recorded the payments. This has left them without storage for their containers.
Mahadi Energy Limited (MEL), a petroleum distributor operating in East and Central Africa with Sh14 billion in capital, has approached the Milimani High Court in Nairobi to challenge the sale of its properties by Premier Bank (PBL), formerly First Community Bank.
The loan of Sh631,558,748 was extended to MEL between 2011 and 2017 under Islamic Sharia laws, including Murabaha and Musharakah, which prohibit high interest or Riba. MEL's managing director, Mr. Ibrahim Hussein Mahadi, stated: “PBL, which was formerly First Community Bank Limited, gave MEL a loan of Sh631,558,748.” He added: “Loans issued under Islamic Sharia laws known as Murabaha and Musharakah do not allow the bank to bankrupt a client by charging high profit (Riba).”
MEL claims it has paid over Sh530 million, but PBL has not reflected these payments in its records. The bank auctioned the Mombasa Mainland container yard, the third largest in the region, which was bought by Shabeel Project Services Limited (SPSL). This has deprived MEL of storage for containers holding perishable goods.
The Mombasa High Court rejected the sale of the yard, but the Nairobi High Court permitted it without full disclosure of facts. Through lawyers Danstan Omari and Stanley Kinyanjui, MEL seeks to overturn the December 8, 2025 order. Judge Mohamed Kullow has directed the submission of case copies and set the hearing for that date.