Mumias creditor urges court to pick new administrator

Mumias Sugar

The entrance to Mumias Sugar Company.

Photo credit: Isaac Wale | Nation Media Group

A Mumias Sugar Company (MSC) creditor has asked the High Court to appoint a new administrator to manage the collapsed miller.

Ms Jackline Kimeto says in the application to be heard on Friday that the term of Mr Kereto Marima, who was appointed the interim administrator by High Court judge Alfred Mabeya in April last year, has lapsed.

Ms Kimeto, who is seeking more than Sh76 million from MSC, said she is apprehensive that the assets of the once giant miller will be pilfered to the detriment of all creditors, who might never recover their debts.

“It has now become extremely necessary for the court to appoint a new administrator to secure the assets of the company and comply with the directions of this court issued on the 14th of April, 2022,” Ms Kimeto says in the application.

The court first appointed Mr PVR Rao the administrator for a period of one year but his appointment was terminated on April 14, 2022 over failure to comply with provision of the Insolvency Act.

He was replaced by Mr Marima but KCB Group and Mr Rao challenged the decision at the Court of Appeal and the court suspended the move in September last year, pending the determination of the case.

Last month, the High Court found officials of the Uganda-based Sarrai Group Ltd in contempt of court, for going on with operations at the troubled factory, despite being ordered to stop.

Justice Dorah Chepkwony found the senior officials of Sarrai Group, including its owner Sarbjit Singh Rai, in contempt of court and ordered them to pay Sh100,000 each, over the failure to cease operations as directed on July 28, last year.

The judge further directed the officials to appear in court on May 18, to show cause why they should not be jailed.

The halting of operations is likely to dash the hopes of farmers who celebrated the reopening of the miller.

Farmers and employees staged a protest yesterday led by area MP Peter Salasya over the directive to Sarrai Group to cease operations. The MP said stopping the miller’s operations is not in the public interest.