Deputy President William Ruto has maintained that the only way Mumias Sugar Company will be salvaged is by sacking the managers.
“The planned government bail-out of Mumias Sugar Company (MSC) will only work out if the former and the current managers mentioned in the KPMG audit forensic report will be sacked and charged,” said Ruto, who was speaking during a funds drive at Kimatuni Catholic church in Bumula Constituency Bungoma County.
Ruto, also announced that the Government had already advertised for the 21 days notice for a special general meeting to change the leadership before the Sh1 billion is issued to save the collapsing sugar firm as the state was no longer going to work with the same corrupt officials who ended up embezzling the Sh900 million that the Government had pumped in last year to save the company.
PLANS TO REVIVE KENYA’S GIANT SUGAR FIRM
Early this month, at a meeting chaired by Ruto, the Government agreed to a Sh5 billion deal with lenders to revive Mumias Sugar Company. The government agreed to release Sh1 billion with the balance being raised by shareholders.
The deal will see more than 50 percent of the board removed and change in the entire management. About 300 staff will also be retrenched. “Sugar brokers” who have made the prices of sugar from the company uncompetitive will be weeded out as well in the efforts to revive the company.
The firm, whose sugar output accounts for about a third of Kenya’s annual sugar output, has been on the verge of collapsing owing to mismanagement. According to reports, MSC losses widened to Sh2.08 billion from a restated loss of Sh407.4 million last year with net revenues for the period to end of December fell 62 percent to Sh2.67 billion.
A forensic audit by KPMG revealed how Mumias Sugar Company’s senior managers misrepresented key facts to its board in an importation deal that cost the miller Sh1.1 billion in losses.
KIDERO ACCUSED OF RUNNING DOWN MUMIAS
The 338-page report also named Nairobi Governor Evans Kidero and his successor at Mumias Sugar Company Peter Kebati among the list of people who have had a hand in the near-collapse of the sugar miller. Kidero has however distanced himself from the scandal and maintained that the company made profits under his nine-year tenure at the helm of Mumias Sugar Company, and he cannot be blamed for the current troubles facing the company.