KDN wishes to set the record straight without discussing the merits of the dispute which is still pending before court as follows:
KDN, the leading Telecommunication Infrastructure Company, entered into a Network Expansion Agreement dated 27th September 2007 with Soliton.
A dispute arose between the parties regarding payment for work claimed to have been performed by Soliton. KDN and Soliton agreed to a joint audit of the work done, the first of which was commenced on the Thika Garissa Mombasa Route. The joint report dated 31st August 2010 indicated that significant aspects of the work had not been performed. Thereafter, Soliton withdrew from reconciliation of accounts and, in pursuit of its claims, filed the present Winding Up Petition on 18th October 2010 against KDN.
On 3rd November 2010, KDN filed an application to stay the hearing of the Winding Up Petition, and refer the dispute to arbitration as provided in the Network Expansion Agreement. The court ordered a stay until KDN’s application was heard and determined. On 30th august 2011, after hearing the parties, the Court surprisingly dismissed the application, and ruled that the Winding Up Petition should proceed to hearing.
KDN immediately applied for an order of stay pending appeal to the Court of Appeal, principally on two grounds:
a) The dispute should have been referred to arbitration as the contract between the parties provided for dispute resolution through arbitration.
b) The alleged debt remains disputed on substantial grounds, with both claiming against each other.
The High Court ordered a stay of its orders for 30 days on condition that KDN deposits a sum of Kshs. 400 million in a joint income account to be controlled and operated by the two counsels on record.
KDN has, on 8th September 2011, since filed a Notice of Appeal and an application under certificate of urgency for Orders of Stay pending the filing, hearing and determination of the intended appeal from the Ruling of the High Court.
KDN remains the largest private data carrier and infrastructure provider in the country with a turnover running into Kshs. 4 Billion as at the last financial year. It operates a combination of microwave radio and fiber optical links, and houses and maintains a number of international internet gateways.
KDN unveiled a multimillion dollar Data Centre on 6th September which is an indicator of the financial health of the company and a statement of commitment and participation to the Kenyan telecom industry.