Mumias Sugar Company's return to operational capacity has been hampered by a lack of resources, receiver manager Ponangipalli Rao has said.
The miller was placed under the receivership of Kenya Commercial Bank in September 2019 over unredeemed debentures to secure the company’s assets.
Efforts to lease the company to an investor slowed down after a section of Western leaders objected to the process, citing a lack of transparency.
Legal officer Patrick Mutuli said that lack of finances was the reason the receiver opted to look for an investor to revive the company that stopped milling three years ago.
The Senate Committee on Agriculture on June 9 summoned Rao over the process of leasing the factory.
It directed him to ensure the process starts afresh and technical evaluation is done.
Sugar cane farmers in the county have said they are ready for any investor who will make the company roar to life again.
Mutuli said the receiver manager's efforts to restart the distillery for the production of ethanol were thwarted by a lack of funds.
The polarised political atmosphere in Mumias and Western Kenya did not help either.
He said the receiver management has so far tilled 670 acres of the nucleus estate land and replanted sugar cane on 580 acres.
The lenders for the distillery were reluctant to provide further funding due to several court cases with uncertain outcomes, he said.
“He would have done much more because he has the potential and capability. He is one of the most trusted receiver managers who has been entrusted to run several other companies in receivership,” he said.
He said rampant theft of company assets and the invasion of the nucleus land by residents who had started planting maize have stopped.
Rao has received resistance from some Western leaders, but he is a trusted administrator and protector of assets for companies in receivership.
He was appointed receiver manager of Kaluworks, one of Kenya’s leading manufacturers of aluminium utensils and roofing sheets in May.
Rao was also appointed the administrator of the Mare Nostrum, which was placed under receivership in July.
Mumias Sugar's revival is one of the issues the leadership in Western is set to seek President Uhuru Kenyatta’s intervention on during his planned tour of the region next month.
Initial attempts by the government to revive the company bore no fruit, even after the Treasury pumped Sh3.5 billion in its turnaround plan.
On June 9, Rao told senators that the value of the company assets was Sh15.7 billion while its liabilities were Sh30.1 billion as at 2018.
Rao said that his efforts to revive the company had been hampered by high transport costs, lack of finances and huge debts.
