Qalaa’s RVR’s contract to run Kenya-Uganda railway terminated, court orders
Kenya Railways has terminated Rift Valley Railways (RVR)’s 25-year contract to run the Kenya-Uganda railway, Business Daily reports. RVR is controlled by investment company Qalaa Holdings. Kenya’s High Court ruled that “the concession agreement dated January 23, 2006 be and is hereby terminated today July 31,2017” following a dispute over the failure of RVR to pay concession fees and missing cargo haulage targets. “RVR will hand back operations, employees and assets…within 30 days…The two parties will now form a joint takeover committee to oversee smooth transfer of assets and operations to Kenya Railways,” the paper reports. Qalaa Holdings confirmed the news, but issued a statement saying the entire investment in RVR is already amortized and that losing the concession will have no impact on the company’s consolidated financial results (watch, runtime 00:51). The company’s shares rallied in trading on Tuesday and Wednesday as investors welcomed the news, with one trader telling us the verdict was “expected” and eliminates uncertainty on the stock.