The government is set to hand over Eldoret-based textile manufacturer Rivatex to
a partner who will take over all its operations under a leasing agreement to
revive the troubled company.
Under the new arrangement, the firm will operate as Rivatex
East Africa SEZ Ltd, marking a new chapter for one of Kenya’s oldest textile
mills.
The official onboarding ceremony will be held today at the
company’s premises and top government officials are expected to attend.
Industry PS Juma Mukhwana will lead the ceremony. Also expected
are Rivatex East Africa Special Economic Zone acting CEO Stanley Bett and
Special Economic Zones Authority CEO Kenneth Chelule.
The partnership seeks to inject new capital, technical expertise
and innovation to restore the company’s competitiveness and strengthen the cotton
and textile value chain.
“The onboarding session will serve as the official unveiling of
the strategic partner, offering the media an opportunity to gain first-hand
insights into the collaboration and its expected impact on Kenya’s textile
industry and the broader strategic direction for Rivatex East Africa SEZ,” the
statement said.
The state-owned textile firm has been grappling with financial
distress and declining production.
A recent audit report by the Auditor General Nancy Gathungu
revealed that Rivatex had incurred accumulated losses amounting to Sh3.04
billion and debts exceeding Sh140.92 million.
The debts include Sh56.88 million owed to
suppliers, Sh2.13 million in accrued expenses, Sh4.33
million in retention monies and Sh67.29 million owed to the Moi
University Pension Scheme.
Gathungu said the firm’s ability to continue operating as a
going concern was in doubt, citing persistent shortages of raw materials —
especially cotton — and high operational costs including labour, electricity,
water, fuel and maintenance.
“In the circumstances, the company’s continued existence may
depend on the goodwill and support from the government, bankers and creditors,”
the report warned.
Rivatex, which is owned by Moi University, was incorporated
on August 16, 2007, with the aim of supporting training, research, extension
and commercial textile production.
However, years of underfunding, management challenges and an
unreliable cotton supply chain have pushed the factory to the brink of
collapse.
The company, which once employed more than 3,000 workers, has
already declared most of them redundant, according to notices issued by the
acting CEO.
The new leasing arrangement is now being viewed as a last-ditch effort to rescue the iconic textile mill, restore jobs and anchor Kenya’s ambitions of revitalising its once-thriving textile and apparel industry.
Instant analysis
The handover of Rivatex to a strategic partner marks a pivotal moment for Kenya’s struggling textile sector. Long plagued by mismanagement, debt and inconsistent cotton supply, the Eldoret-based factory had become a symbol of industrial decline despite heavy public investment. Leasing it out signals a pragmatic shift — from state control to private-led revival — aimed at injecting capital and efficiency into the value chain. However, success will depend on the partner’s ability to restore production, secure raw materials, and rebuild trust with former employees and suppliers. Without clear oversight and sustained support, Rivatex risks repeating its troubled past.
