Probe into Kenya hotel sell-off

http://news.bbc.co.uk/go/rss/-/1/hi/world/africa/7481140.stm

Version 0 of 1.

Kenyan Prime Minister Raila Odinga has called a special cabinet meeting to investigate the sale of a luxury Nairobi hotel to Libyan investors.

Mr Odinga will probe claims that the Grand Regency Hotel was sold for a third of its true value.

Finance Minister Amos Kimunya has denied any wrong-doing - or that the deal was made in secret.

The BBC's Adam Mynott says the row threatens to drive a wedge into the government of national unity.

Mr Odinga was named prime minister after weeks of violence over last December's disputed elections, in which he claimed he was robbed of victory by President Mwai Kibaki.

Donors accuse Mr Kibaki of failing to keep promises to tackle the rampant corruption in Kenya.

Lands Minister James Orengo, an ally of Mr Odinga, who revealed the sale of the hotel last week, says he intends to revoke the transfer of the prestigious hotel to protect the public interest.

Local media reports suggest influential ministers and senior civil servants coerced junior officers at the Lands Ministry to transfer the hotel ownership without involving Mr Orengo.

The hotel was allegedly sold for about $45 million instead of its recorded valued of $115 million.

Amnesty

Last year, Kenya signed an exclusive trade pact with the Libyan government, which gave its companies a head start over other investors when competing for lucrative government contracts.

The trade pact was signed after a meeting between President Mwai Kibaki and his host Muammar Gadaffi.

The Grand Regency was recovered from Kamlesh Pattni, the man behind the Goldenberg scandal, in which the government compensated him millions of dollars in a fake gold export scheme.

He surrendered his interest in the hotel, it is claimed, in exchange for amnesty in connection with outstanding corruption charges against him.