Mumias Sugar receiver asks management to handover as takeover kicks off

Mumias Sugar receiver asks management to handover as takeover kicks off

September 26, 2019 0 By mykenyancareers
MUMIAS SUGAR PROCESSING - Mumias Sugar receiver asks management to handover as takeover kicks off
The company’s receiver manager PVR Rao has also invited the company’s debtors and creditors for engagement, a move he says will assist in understanding the extent of the miller’s financial problems.

NAIROBI, Kenya, Sept 26 – The Management and directors of Mumias Sugar company have been given 14 days to submit the statement of the company’s affairs and to handover all assets of the company, including motor and commercial vehicles and office equipment.

The company’s receiver manager PVR Rao has also invited the company’s debtors and creditors for engagement, a move the Manager says will assist in understanding the extent of the miller’s financial problems.

“None of the directors, shareholders, employees nor any other person is authorized to transact any business on behalf of the company without express written consent from the receiver,” Rao says.

This comes a day after cane farmers urged the National Treasury to come clear on the status of their land at the company following its takeover by the receiver manager.

The concern was raised by Mumias East MP Benjamin Washiali who has been spearheading efforts to revive the cash-strapped giant sugar miller.

Washiali said the cane farmers want government assurance that they will not lose over 4,294.8 hectares of land which they had leased to the company for growing sugarcane.

His sentiments followed those of Kakamega County senator Cleophas Malala who asked the National Government to halt the liquidation of the firm insisting for the implementation of the recommendations offered by the sugar task force report, before placing the company under receivership.

“We will not allow any step to be taken as far as the receivership is concerned before the sugar task force report is released and handed to the president to pave way for the implementation of the measures outlined,” Malala said.

The report was validated in April, despite opposition by farmers on some sections.

On Tuesday, Kenya Commercial Bank placed the debt-ridden miller under receivership a move meant to protect its assets.

This is after Mumias defaulted to pay up the Sh12.56 billion loan it owes creditors, among them KCB, Ecobank Kenya and Commercial Bank of Africa.

In January, the three banks recalled the Sh2.6 billion loans they had disbursed to the insolvent firm, breaking ranks from other lenders, including French investment fund Proparco, who are owed Sh9 billion.

Mumias’ current liabilities exceeded its current assets by Sh21 billion for the year ending 30th June 2018, compared to Sh15.2 billion in 2017.

During the period, the company incurred a loss of Sh15.1billion, compared to Sh6.7 billion in 2017.