Sugar board may place firm under receivership

The Kenya Sugar Board intends to place Mumias Out Growers Company under receivership.

Two KSB directors from the Mumias sugar zone Mohammed Mukhwana and Bill Wanjala said the move had been necessitated because of failure by Moco to repay a Sh120 million loan extended help in procurement of farm machines.

They said that the industry regulator would not give the outgrower firm a further Sh100 million as claimed by the company directors unless the pending loan was repaid.

Assist miller

Instead, Mr Mukhwana said, KSB would extend a Sh300 million loan to Mumias Sugar Company to assist the miller carry out an ambitious cane development project in the zone for the benefit of the growers.

“We have already agreed in principle over this arrangement only that KSB would wish to understand how the money would benefit a large number of farmers in Mumias sugar zone,” he said.

Both Mr Mukhwana and Mr Wanjala said KSB was planning to ensure that all sugar millers in the country were producing at efficiency levels as they brace for the expected stiff competition after the lapse of Comesa safeguards in three years time.

Improve factories

“We shall be addressing infrastructure issues and how to improve our factories to make sure that our sugar industry survives long after the lift of the safeguards we have been enjoying,” added the directors.

Already, meetings bringing together all stakeholders in the sugar industry were on-going according to the pair.

“Some projects we invested in such as the Matawa-Indangalasia bridge whose construction cost about Sh90 million is over now,” said Mr Mukhwana.