•Ponangipalli Venkata Ramana Rao was appointed as the Receiver Manager to protect the company’s assets and maintain its operations to the best extent possible.
•According to Rao, many of them did not pass the test of evaluation, which was based on the technical and financial capabilities of the investor.
Image: HILTON OTENYO
The leasing process of Mumias Sugar Company Limited is not complete, the receiver manager has said, on the back of a heated debate over revival of the company.
This, as one of the bidders–Devki Group of Companies on Friday announced it had pulled out of the bidding process.
Steel tycoon and Devki Group chairman, Narendra Raval, cited the ongoing public interest which “the matter” has attracted and the call for publicly run bidding exercise.
“We have found it worthwhile to take out our application. We will however express interest ,should the exercise be conducted in consultation with all the stakeholders,” Raval said in a statement.
Political leaders from the Western region, where the plant is located, have in the past one week made public statements seeking more information while calling for transparency in the take-over process.
The loss-making miller was placed under receivership by KCB Group in September 2019.
Ponangipalli Venkata Ramana Rao was appointed as the Receiver Manager to protect the company’s assets and maintain its operations to the best extent possible.
The Receiver is aware of the various public comments that have recently been made regarding the leasing of the company and the subsequent reactions it has elicited. The Receiver would like to inform the public that the leasing process is not completePonangipalli Venkata Ramana Rao, Receiver Manager
Under the leasing deal, the successful firm is expected to run the plant on behalf of KCB whose Sh545 million, in loans, was defaulted by the miller.
The Receiver initiated the revival process by starting the distillery operations which faced several challenges relating to shortage of molasses in addition to the exorbitant cost of transporting molasses and bagasse from other factories.
Also started was the nucleus land development by funding the ploughing of 677 ha and replanting 370 ha of the nucleus estate by using own seed cane.
As directed by the lenders' holding security over the Ethanol Plant, the distillery operations had to be suspended in March 2021.
All these developments left the Receiver with only one option of leasing Mumias assets to revive the operations and to progress recovery efforts for the stakeholders of Mumias, Rao said in a statement on Friday.
This saw a requested for bids for the revival of the company placed, which attracted eight bids.
According to Rao, many of them did not pass the test of evaluation, which was based on the technical and financial capabilities of the investor.
The technical capability was given priority over the financial capability (except to the extent that the investor was considered capable of funding the revival of the operations), as the most important aspect of the leasing is the revival of the operations and assisting the community by providing the employment, the Receiver manager notes.
“The Receiver is aware of the various public comments that have recently been made regarding the leasing of the company and the subsequent reactions it has elicited. The Receiver would like to inform the public that the leasing process is not complete,” said Rao.
The manager has since assured that all due processes will be followed and interest of all the stakeholders met.
“The Receiver is keen towards revival of the operations of the company to bring back the original glory of the region creating employment opportunities and, in that direction, has explored all possible solutions for a viable turnaround,” Rao notes.