NAIROBI (AFP) - The sale of a luxury Kenyan hotel to a company reported to be Libyan, which has sparked national outrage, was clean and the government was aware of it, Libya's ambassador to Kenya told local television on Monday.

"I want affirm that this deal was very clean and everybody in the Kenyan government knew about this," Hesham Ali Shariff told Kenya Television Network (KTN).

The sale of Nairobi's Grand Regency hotel to a company called Libyan Arab African Investment Kenya Limited (LAAIKL), sparked a row that resulted in parliament carrying a vote of no-confidence in Kenyan Finance Minister Amos Kimunya last week.

Lands Minister James Orengo tabled documents indicating that the hotel was sold for 1.8 billion shillings (28 million dollars/18 million euros) but Kimunya maintained during his defence in parliament that it was sold for 2.95 billion shillings.

The minister has refused to resign, but parliament insists that it will not accept Kimunya handling government business on the floor.

Although critics said LAAIKL had dubious ties with Libya, Shariff said the company was the Kenyan chapter of a Libyan government company that runs 23 hotels in more than 15 African countries.

"This company is a government company and we bought Grand Recency Hotel and we transferred the money from the Libyan government to the Central Bank of Kenya," he added.

The issue has split the fragile coalition government made up of President Mwai Kibaki's Party of National Unity and Prime Minister Raila Odinga's Orange Democratic Movement.

Odinga is due to brief parliament on Tuesday on the outcome of a probe he chaired into the sale.

Meanwhile, the government has registered a caveat against the title deed to protect the hotel.

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