INVESTMENT

Dangote-linked firm bids to manage Mumias Sugar

Tumaz and Tumaz emerged as the top bidder with Sh27.6 billion for a 20-year lease.

In Summary

• Tumaz and Tumaz emerged as the top bidder with Sh27.6 billion for a 20-year lease in the Mumias Sugar bidding process.

• The tycoon said he will offer the farmers Sh2.2 billion through Mumias Outgrowers Company (MOCO) as an incentive to start growing sugarcane.

Mumias Sugar Company entrance.
Mumias Sugar Company entrance.
Image: HILTON OTENYO

Tumaz and Tumaz Enterprises a company associated with Mwale City Investor Julius Mwale has hired JPMA (J P Mukherji & Associates), is set to run Mumias Sugar if it wins the bid.

JPMA is an Indian company running Dangote Sugar refineries in Nigeria.

Tumaz and Tumaz emerged as the top bidder with Sh27.6 billion for a 20-year lease in the Mumias Sugar bidding process.

The Mumias Sugar receiver-manager P V Rao said the bids will undergo technical and financial evaluation before announcing the winning bid.

Other bidders who submitted their bids are Kruman Finances associated with French and Turkish investors, with a bid of Sh19.6 billion for a 25-year lease and Transmara Group (Sarai) with a bid of Sh11.5 billion over a 20-year lease period.

Others are Pandhal Industries with Sh9.7 billion over a 20-year lease. Kibos Sugar bid came in at Sh8.8 billion.

Devki bid at Sh8.4 billion over a 20-year lease and the West Kenya Sugar bid was Sh3.5 billion.

A Mauritius based company Sucrie Des Mascarelgnes Ltd also participated but did not disclose the value of its bid.

Mwale's hiring of JPMA gives an insight into his plans of running the miller if he wins the bid.

JPMA has been a consultant and manager of many sugar factories across the world including Saudi Arabia, India, Ethiopia, Uganda, Tanzania and Nigeria.

LARGEST SUGAR PROJECT

It also consulted for the establishment of Kwale Sugar company in 2014.

Their work with Dangote is currently one of the largest sugar projects in the world.

It is upgrading Dangote's factories to crush 24,000 tonnes of cane per day from 6,000 tonnes per day.

Dangote's Sugar division reported Sh35 billion turnover for the first six months of 2021, an increase of 27 per cent from the previous year.

It is the largest supplier of sugar in Africa.

Dangote Sugar division is part of Dangote group whose chairman is a Nigerian Aliko Dangote, Africa's richest person with a fortune of Sh1.2 trillion.

Mumias Sugar reported revenues of Sh3.5 billion for six  months in 2015, which decreased to Sh800 million for six months in 2018 before entering receivership.

Mwale said JPMA has been his technical bidding partner, together with the US consulting and infrastructure firm KE International.

He told a local daily that he secured Sh22 billion ($200 million) from a top American bank to strengthen his bid.

The tycoon said he will offer the farmers Sh2.2 billion through Mumias Outgrowers Company (MOCO) as an incentive to start growing sugarcane.

He also allocated Sh2.2 billion each for a new Hospital, housing, airport and for the upgrading of an ethanol plant to manufacture medicines and vaccines.

He further allocated Sh5 billion to the factory upgrade, Sh800 million to the water bottling plant and Sh2.2 billion to the power generation plant.

Edited by D Tarus