President William Ruto promises to get new investor to revive Mumias Sugar

Ruto

President William Ruto meets with Western Kenya leaders at the Kakamega State Lodge, Kakamega County, on December 8, 2022.


     

Photo credit:  PCS

President William Ruto has promised to get a new investor to revive Mumias Sugar Company and restore thousands of jobs lost in the troubled sugar miller. 

Speaking during his tour of Western Kenya on Thursday, President Ruto said he will also revive Nzoia Sugar Company as he seeks to expand employment opportunities for Kenyan youth and farmers.  

"The government will pay all the debts for sugar factories. I will bring a new investor for Mumias and oversee its revival. The current issues at Mumias cannot be allowed to continue," said the President.

Dr Ruto’s remarks come at a time when Uganda-based Sarrai Group has been battling court cases after it was kicked out from the sugar miller in April 2022.

Sarrai Group controversially won a 20-year lease tender in December 2021 following a bidding process that saw higher bidders locked out. 

However, in April 2022, High Court judge Justice Alfred Mabeya ordered Sarrai Group to leave the premises. The court also removed Ponangipali Venkata Ramana Rao as the administrator of the company.

The court further appointed Kereto Marima as the new administrator of Mumias Sugar Company and ordered Rao to hand it over.  

"This court has considered the allegations made against the leasing process. Rao awarded the lease to the lowest bidder while there were higher bidders without giving any justifiable explanation,” the judge ruled.

Justice Mabeya said public interest demands that receivership that has yielded zero results takes a back seat and a professional administration of Mumias is given a chance.

He added: "It would have been essential to even have a pre-evaluation of Mumias which would have informed a result price that would have achieved the purpose of paying off Mumias debts and releasing it from receivership and administration. 

“The manner in which Rao handled the leasing process did not tally with what was expected of him as an administrator. His actions were meant to protect the interests of KCB and if the lease is upheld, the same would be tantamount to blessing KCB with an extra asset known as Mumias for the next 20 years, and of course, would be the greatest miscarriage of justice."

In October this year, sugarcane farmers and former Mumias Sugar employees took to the streets to protest Sarrai Group's stay at the sugar miller despite a court order kicking it out. 

The workers claimed that the firm had imported employees from Uganda and locked out locals and former workers of the troubled miller.  Workers also questioned the controversial leasing of the Mumias Sugar nucleus land. 

They alleged that Sarai Group appropriated more than 8,000 acres almost for free.

“The average price of land in Mumias now is Sh700,000. Multiplied by 8,000 acres, the value is Sh5.6 billion but Sarrai is getting it almost at no cost,” said Mumias Sugar Workers Union Chairman Patrick Mutimba during the demos in October.

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