Kenya Electricity Generating Company (KenGen) risks losing Sh363.03 million invested in fixed deposits with Stima Investment Co-operative Society after the savings and investment society failed to repay the funds. The dispute, which dates back to investments made between 2015 and 2016, is now before the High Court as the power producer's foundation seeks to recover the money and accumulated interest.
According to KenGen's latest annual report, the company's charitable arm, KenGen Foundation, invested Sh100 million of its endowment funds with Stima through fixed-deposit arrangements offering a 16 per cent annual return. The investment was made in two tranches of Sh50 million.
The foundation's management said the principal and accrued interest had grown to Sh363.03 million by September 30, 2024. After failing to recover the funds, it filed a recovery suit against Stima on November 24, 2024.
Stima admitted owing Sh90 million but disputed the balance claimed by the foundation. The society proposed settling the admitted amount by transferring 19 one-bedroom residential units in Ruiru, Kiambu County. The offer was rejected.
In a ruling delivered on September 15, 2026, the High Court entered judgment in favour of KenGen Foundation for the admitted Sh90 million. However, the court allowed the contested portion of the claim, including the disputed interest calculations, to proceed to a full hearing.
The foundation's claim includes interest accumulated under an alleged rollover arrangement. Stima disputes the interest calculation and the agreement on which the larger amount is based.
The Auditor-General also questioned the original investment, noting that KenGen had not provided evidence of the necessary approval, an investment policy or due diligence conducted before placing the funds. The audit report said recoverability remained doubtful.
The investment offered a 16 per cent return, higher than the average 10.85 per cent interest rate on 364-day Treasury bills between 2015 and 2016.
KenGen has continued supporting its foundation, donating Sh100 million in the financial year ended June 2026, compared with Sh61.6 million the previous year.
The remaining court proceedings will determine whether the foundation can recover the disputed balance beyond the Sh90 million already admitted by Stima.
