How Karume shared his vast estate among heirs

Njenga Karuma       PHOTO: COURTESY

By PAMELA CHEPKEMEI

When he breathed his last, self-made billionaire James Njenga Karume automatically moved his heirs to the top decks of the world’s club of multi-millionaires.

Through his last Will and Testament, a transfer of all his worldly assets was made to his closest kin, with his then four-year-old son Emmanuel Karume Njenga set on a straight path to billionaire status.

The boy will inherit all his father’s shares in Kiambu General Transport Agency Ltd. He will take over shares in nine other companies, all shares in Majoreni Agencies Limited, all shares in Ngorongo Tea Factory Limited, 25 per cent shares in Heri Limited, 12.5 per cent shares in Kenya Wine Agencies Limited and a share in each of the following companies: Jacaranda Hotel Limited, Karume Investments Limited, Kabete Distributors Limited, Cianda Estates Limited and Forest Road Flats Limited.

Among his other beneficiaries of the vast Karume Empire are his driver, bodyguard and cook.

It has emerged that eight months before his death, Karume swore under oath in front of his long trusted physician Dr Dan Gikonyo of Karen Hospital and Bishop David Kamau, to ensure his vast estate was divided according to his wishes.

The Catholic Archdiocese of Nairobi, and Sisters of the Immaculate Heart of Mary were the only institutions not directly affiliated to the late tycoon that received parcels of land from him.

The Will, which The Standard on Sunday has seen, is explicit and dictates to the tee, the amount of inheritance each beneficiary is entitled to.

The tycoon’s wife, four daughters, four sons and his grandchildren each got a piece of the expensive pie, which conservative estimates put at Sh120 billion.

Karume did not want his clothes, attire and wearing apparel to be distributed but he donated them to a charitable institution to be selected by executors of his Will. He gave all his chattels including household items, furnishings and personal effects to his wife Grace Njoki.

In the Will dated June 6, 2011, the businessman and veteran politician instructed his lawyers to transfer all his properties to the intended beneficiaries before he died and if any transfers were incomplete upon his death, they were to be treated as a bequest to the beneficiaries.

Multi-billion estate

Karume who, according to his autobiography built his multi-billion estate from scratch, died at 83 years in February 2012 after a long battle with prostate cancer.

The assets owned by Karume’s estate range from huge tracts of land in prime locations, hotels, housing estates and shareholding in some of the country’s blue chip listed or privately owned companies.

The executors of the Will are listed as 61-year-old daughter, Dr Francisca Wanjiku Kahiu, a cousin, James Njenga and friend Stephen Karau.

The executors have applied to the High Court to have the authority to oversee the division of the estate.

The Will and Testament contains details of how Karume wanted to be buried:

“I direct that I should be buried in accordance with Christian rites on a property known as LRN131/10 measuring approximately three acres which has been donated by Cianda Estates Limited to the Sisters of The Immaculate Heart of Mary Mother of Christ Registered Trustees and on which I have earmarked my immediate family’s graveyard…I direct my executors to construct a mausoleum at my burial site and a library at an appropriate location near my burial site,” reads part of the Will.

The biggest beneficiary among his employees is his long serving driver who will be given Sh1million.

His bodyguard and cook will each be given Sh500,000. Karume’s daughter Dr Francisca Wanjiku Kahiu will receive Sh10 million in cash from her father’s estate.

She will also benefit from 12.5 per cent shareholding in Kenya Wine Agencies Limited and 25 per cent shareholding at the Paper House Limited.

Another daughter Teresia Karume, 55, was given Sh2 million by the father and shares in the two companies equal to her sister Dr Kahiu. Jane Mukuhi Matu, 52, another daughter of Karume will benefit from an apartment of not more than Sh15 million owned by her father’s estate. Mukuhi and her children will hold the property jointly.

She will also take all the shares of her late father in Bata Shoe Company, 12.5 per cent shares at KWAL, and 25 per cent shares at the Paper House of Kenya.

Karume’s wife Grace Wanjiku, 49, whom he married after the demise of his first wife, will take over surplus cash in his personal bank accounts once all expenses and personal debts are paid out. She will also choose and retain two motor vehicles of whatever make. All the four vehicles listed in Karume’s name are Mercedes Benz.

Grace, the mother of Emmanuel, was also bequeathed with all of Karume’s shares in companies listed on any recognised stock exchange in Kenya and abroad. Grace will benefit from the land in Kiambaa and all shares in Kigutha Farmers Limited. Karume further entrusted her to hold in trust for Emmanuel his inheritance until he comes of legal age to own property.

Karume’s other three sons, Samuel, Henry, and Albert will each get 25 per cent shares in Heri Ltd and 12.5 percent shareholding in KWAL. Albert will further retain all the shares held by the father in Pelican Insurance Brokers Ltd.

Employed professionals

Karume’s wife, daughters and sons will each be given parcels of land in different parts of the country including Nakuru, and the Cianda Farm in Kiambu. Several other parcels of land are to be transferred to the empire’s flagship companies such as Karume Investments Ltd, Jacaranda Holdings, and Karume Holdings.

Any other assets that would remain unattached after the transfers and division of the estate are to be held through a trust set up by the executors for purposes of promoting the maintenance of education and advancement in life of his dependents.

Karume’s other businesses include the Jacaranda Group of Hotels that owns Jacaranda Hotel-Nairobi, Jacaranda Indian Ocean Beach Resort at the Coast, Lake Elementaita Lodge in Naivasha, Pizza Garden as well as the Village Inn.

Before he died, he formed the Njenga Karume Foundation to manage his investments on behalf of his heirs. He also formed a board to manage his Jacaranda Holdings. Mary M’Mukindia, the former managing director of National Oil Corporation Kenya is the chairperson of the Jacaranda Holdings.

M’Mukindia heads a Board of Trustees Mr Karume picked before he died. Tella Kawira, an administrator of the trust works in conjunction with a team of other managers and members of the Karume family.  He also employed professionals to run his businesses. Karume’s estate is estimated to be worth Sh120 billion.  The late Karume remains one of the few Kenyan politicians who also doubled up as successful businessmen whose passing did not elicit a fight for his empire.

However, upon Karume’s death, then 45-year-old schoolteacher Edwin Thuo emerged to stake claim to Karume’s wealth alleging that the latter was his father. Thuo wanted Karume’s funeral put on hold until extraction of DNA material was done for use in two paternity cases pending in court.

The High Court dismissed the petition filed by the high school teacher.

Striking out the suit, Justice David Majanja who was hearing the case said that the case by Thuo had been settled three years prior through an agreement by all parties. The judge said that the case could not be reopened because litigation had to come to an end.

At the time of his death, Karume was among the wealthiest Kenyans.