Kingi loses bid to quash reinstatement of cement directors

By FREDRICK OBURA

Efforts by acting Industrialisation minister Amason Kingi to stop reinstatement of suspended East African Portland Cement Company (EAPCC) directors suffered a setback.

Milimani Commercial Court Judge Joseph Mutava Thursday dismissed the minister’s application that sought to stay the suspension of EAPCC board of directors and its Managing Director Kephar Tande.

In his ruling, the judge said going against reinstatement order would have far reaching effects to the company and its shareholders.

"Attempting to interfere with an earlier reinstatement order would plunge the shareholders, employees, suppliers and the country into another void of uncertainty," he said while dismissing the minister’s application.

He said re-instatement of the EAPCC bosses after the abrupt suspension was necessary to save the company from losing business at a time when competition in the industry is stiff.

Following the minister’s suspension of the board in December, EAPCC affairs have been thrown into a state of confusion with two groups claiming legitimacy of running the company. The company’s shares have since been suspended from trading at the Nairobi Securities Exchange.

Shareholding

"This alone was compelling ground for this court to interfere as the effect of suspension of the shares from trading was poised to diminish shareholder value in the company and dislodge it from its market position," Justice Mutava said.

He said the minister went overboard in making the decision as the Government only has 25 per cent shareholding.

"Not even the addition of NSSF shares grant the Government a controlling quality in the company," the judge said in his ruling.

Mutava further said the assumption that NSSF shareholding could be equated to the shareholding of the Government was itself disputed and so was the status of the company as a State corporation.

"The interim injunction orders are to check excesses of the minister and restore order to the company," he said.

On Monday he issued the temporary injunction, which is to remain in force until January 19 when all parties appear in court for hearing.