Competition Authority of Kenya (CAK) has told the court that no merger approval has been submitted to them in relation to leasing the assets of Mumias Sugar to the Ugandan firm Sarrai Group.
CAK is the government regulator which approves mergers and acquisitions.
CAK was responding to the lawsuit filed by five Mumias Sugar farmers.
The five include Lambert Ochochi, Augustino Saba, Prisca Ochacha, Robert Magero and Wycliffe Ng'ong'a.
The filed a suit against the statutory manager, PV Rao (KCB's receiver-manager), KCB, Attorney General Kihara Kariuki, the Agriculture Cabinet Secretary, the Competition Authority of Kenya (CAK), Sarrai Group Ltd, the Chief Land Registrar, the County Government of Kakamega, the Capital Markets Authority and Gakwamba Farmers' Cooperative.
"The 5th Defendant/respondent has not received any merger notification from the 1st defendant/respondent, 6th Defendant/respondent or any other party seeking the approval of the transaction involving the acquisition of the assets of Mumias Sugar Company Limited (in receivership)," CAK Director General Wang'ombe Kariuki said in a sworn affidavit.
The farmers are challenging the lease award to Sarrai group, on the grounds that the lease was undertaken in an opaque manner and awarded to the lowest bidder Sarrai Group without regulatory approvals.
Milimani commercial court presiding Judge Justice Alfred Mabeya on Monday, February 7, 2022, said the matter must be determined expeditiously and consequently set the hearing from February 14th to 17th, 2022.
The Milimani high court judge Wilfrida Okwany on January 14, temporarily stopped the Uganda based firm, from proceeding with operations at Mumias Sugar.
The stop was for 10 days pending the hearing and determination of the case.
She extended the orders at the January 25, 2022 court hearing to March 14th, 2022 to allow new parties to be enjoined in the case.
The new parties included the bidders West Kenya Sugar limited represented by Senior Counsel Paul Muite, Tumaz and Tumaz Enterprises represented by Nelson Havi, and Mumias outgrowers company (Moco).
West Kenya Counsel Paul Muite had faulted the bidding process saying it was not conducted in a fair and transparent manner.
"The dispute should be determined expeditiously. It must be resolved once without much delay", Justice Mabeya said on Monday.
The Judge enjoined all the parties seeking to be part of the suit and directed them to file their papers within 3 days and the applicants to file their responses within 3 days.
When the case comes up for hearing on February 14th, the parties will be highlighting submissions.
In response, Sarrai Group argued that the assets of Mumias are wasting away because of the orders stopping its operations.
On Tuesday, February 8, 2022, in another case filed against Sarrai Group and Rao on December 29, 2021, high court Justice Kenneth Ndung'u kept the earlier lease suspension orders in place.
He also set the ruling of the case on March 3rd, 2022.
