- Company lawyer Patrick Mutuli says factory is under tight security and all activities are documented.
- Mutuli says the claims of cannibalisation were started by one of the security firms guarding the factory.
Image: HILTON OTENYO
Mumias Sugar Company management has denied reports that the factory is being cannibalised and assets sold off.
Lawyer Patrick Mutuli on Wednesday said the company is under tight security and all activities are documented.
“Anything that leaves the factory some times for repairs in Kisumu is documented when being taken and when they’re returned. There is nothing like cannibalising the factory here,” he said in Kakamega town.
Mutuli said the claims of cannibalisation were started by one of the security firms guarding the factory.
Two firms have been engaged to provide security; one is engaged by receiver manager Ponangipalli Venkata Ramana Rao and investor Sarrai Group.
Rao is representing interests on secured lenders (banks) while Kereto Marima is representing interests of unsecured lenders.
“These claims began when a truck supplying gas cylinders came to the company premises and made their supplies and left with others. One of the security firms then claimed the truck had left with more cylinders than it came in with and that’s where this talk of cannibalisation began. The cylinders don’t belong to the company,” Mutuli said.
The company was placed under receivership by the Kenya Commercial Bank to secure the interests of secured lenders in September 2019.
The government is its biggest shareholder owning 20 per cent, KCB Group has 1.72 per cent shares, Jubilee Insurance has 1.46 per cent and two Standard Chartered Nominees Limited accounts at 1.4 per cent.
Individual shareholders hold 71.35 per cent of the Nairobi Securities Exchange-listed firm.
The revival of the former premier miller by the receiving manager through leasing the company's core and non-core assets has been delayed by court cases.
Mutuli said some people were taking advantage of stalemate in the courts to invade and use company land.
“They come in anytime stop orders are issued by the courts and till the land,” he said.
Mutuli said rent from the staff quarters has drastically dropped due to fraudsters who take advantage of the court cases.
“There are some people who go round asking occupants not to pay rent to the management but come back round to demand half the rent from the same people,” he said.
Meanwhile, politicians seeking elective seats in Kakamega county have avoided the issue of the company in their campaign messaging.
This is because earlier promises by politicians that the company would be revived have remained just that.
Majority of cane farmers have become disillusioned and politicians fear mentioning revival of the giant miller would annoy voters and lead to their rejection.
Edited by Josephine M. Mayuya