Kakamega County gov’t backs KCB receiver manager in Mumias Sugar lease
Kakamega County has backed the KCB-appointed receiver manager to revive the rundown Mumias Sugar Company even as the leasing process faces a storm.
In a statement issued on Wednesday, the County says the receiver manager is best placed to pull Mumias Sugar from the abyss encompassed largely by deep financial woes.
“As the County Government of Kakamega, we rally behind the efforts of the receiver manager, on behalf of KCB Bank Kenya Limited in getting an investor to revive the factory. We trust that KCB being a reputable institution has credible processes that will deliver the most suitable investor and undertake the revival of Mumias,” said Governor Wycliffe Oparanya.
“The County will fully support all the efforts that will bring the factory back to operations immediately and shall ignore those that think this is an opportunity to benefit themselves at the expense of poor farmers.”
Ponangipalli Venkata from Tact Consultancy has been Mumias administrator since it was placed under receivership by KCB for debt defaults in September 2019.
With the factory requiring an infrastructure upgrade to return to full-scale operations, the receiver has favored the leasing of the State miller to a private investor to inject the much-needed capitalization to breathe life back.
However, the receiver’s decision to favor a private leasing process has opened a can of worms as stakeholders point accusing fingers at each other over alleged manipulation of the process.
For instance, the conflict has tied up politicians as stakeholders in Mumias seemingly jostle to control the once successful State Corporation.
Nevertheless, Mumias’s receiver manager has favored private pacts terming them as more efficient in seeking out a suitor for the miller.
“The receiver opted for private treaty to avoid technical constraints and procedural delays,” the receiver said in responses to the Agriculture and Food Authority (AFA) dated June 4.
So far, Russia’s Catalysis Group, Sarrai Group of Uganda, Kruman Associates from France, Kibos, Devki Group, Premier JV (India) Third Gate Capital management and Godavari Enterprises India have all expressed interest in leasing out the firm.
Mumias Sugar was placed into receivership after falling into technical insolvency with total liabilities outstripping total assets by Ksh.14.39 billion.
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