Mumias Sugar board, 300 to be sent home
07 March 2015, 10:34
Nairobi - Deputy President William Ruto has confirmed that the board of sugar firm Mumias Sugar will be sent home to pave way for restructuring of the company.
The deal worth KES 5 billion will see the government provide KES 1 billion to the firm to continue operations with the other 4 billion coming from a share offer to raise money which will be conducted by audit firm KPMG.
" We have come to a deal. There will be changes for the better of the company," Ruto said Friday.
It is understood that up to 300 employees will also be sent home in the restructuring plan.
The company owes lenders as much as KES 4 billion, issues that have emanated from what many term as mismanagement from the firms bosses.
Lenders include Ecobank, KCB, CfC Stanbic, Barclays Bank, Commercial Bank of Africa and Proparco of France, who appointed KPMG to look into ways of recouping their money.
The report released by KPMG on the state of the company stated that current Nairobi Governor Evans Kidero who was the then CEO, disregarded several pleas to look at the many leakages that were evident at the largest sugar miller in the country.
The meeting led by Ruto to seek a way forward was attended by Treasury Principal Secretary Kamau Thuge, Mumias Board Chairman Dan Ameyo, chief executive Coutts Otolo as well as the lenders.
" It is vital that we take these stringent measures so that farmers can be paid for their produce," Ruto added.
Mumias has just over 1,900 employees and has been making losses since 2012, a crisis which led to farmers taking to the street to protest lack of payment of their dues.
Some farmers have not been paid for up to 2 years, a matter Ruto says has to be settled as soon as possible.
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