DEBT-RIDDLED

Coffee farmers reject orders to close down KPCU

They say they last supplied cooperative in June and are awaiting payment for produce.

In Summary

• KPCU draws its membership from more than 703,000 farmers the majority of whom are smallholders. 

• Farmers term directive to deregister firm illegal 'as it did not follow right procedure'.  

Trade CS Peter Munya
LIQUIDATION REJECTED: Trade CS Peter Munya
Image: VICTOR IMBOTO

Coffee farmers have challenged a decision by the government to liquidate the debt-riddled Kenya Planters Cooperative Union. 

KPCU draws its membership from more than 703,000 farmers the majority of whom are smallholders. Last month, the state issued a gazette notice to place the firm under liquidation.

Cooperative Development acting commissioner Geoffrey Njang'ombe picked a team of four officials to oversee the liquidation process to be completed over six months. 

Through lawyer Guandaru Thuita, farmers say they last supplied coffee to the company in June. The coffee was milled and the procedure for selling it followed. They received relevant documentation for the receipt of their coffee and were awaiting payment for the proceeds of their coffee. 

But on August 2,  the farmers learnt the company had been placed under liquidation under the orders of Trade CS Peter Munya and Njang'ombe. 

They claim the directive is illegal and amounts to an illegal takeover of a solvent institution.

“It’s wrong to cancel the registration of the company and rushing to appoint liquidators without following the due process laid down in law,” Thuita said. 

The farmers claim that should the court not step in at the earliest opportunity, they will incur irreparable losses and harm. 

They want the court to suspend the process. 

 “We had so much faith in the company that we individually bought shares. In our respective individual capacities, we hold a sizeable number of shares,” they said. 

Njang'ombe appointed Stephen Njoroge, Doris Githua, Anthony Maina, Joyce Kinuu to take into their custody all the properties of the union including books and documents as are deemed necessary to complete the liquidation. 

Edited by R.Wamochie