Troubled cement manufacturer East African Portland Cement Company (EAPCC) now says it needs at least Sh15 billion to avoid a complete shutdown of its operations.
The loss-making Government-owned company, which has been denied a bailout by the State and which has failed to attract a strategic investor since its troubles began eight years ago, said yesterday it was in a worse financial shape than initially thought.
The firm has already sunk into a Sh10.8 billion debt, with its biggest creditor being Kenya Commercial Bank (KCB) which it owes Sh4.5 billion.
Edwin Kinyua, Portland’s new board chairman, yesterday told the Senate Committee on Trade and Industrialisation Sh15 billion is the bare minimum required to get the firm back on its feet.
“You can see that our situation is grave. Even if we get the Sh15 billion, Sh10.8 billion will go to settling debt.
- 1 Cement maker cuts loss on lower costs
- 2 EAPCC interim MD fired amid board split rumour
- 3 EAPCC boss fired amid board split rumour
- 4 The State firms that are more debt than alive
“Yet we need Sh2 billion to refurbish our ageing plant which right now is in a bad state and we need Sh1 billion for working capital financing,” said Mr Kinyua, who was accompanied by the firm’s Managing Director Peter Ole Nkeri and other officials.
He at the same time revealed that the company has not been remitting its employees’ monthly deductions for their loans to various banks as well as honouring its tax obligations to Kenya Revenue Authority.
Mr Kinyua said they were now banking on a memorandum that had been tabled to the Government by Treasury and Trade Cabinet secretaries, seeking approval to sell 900 acres of its prime land in Athi River to another troubled State enterprise – the Kenya Railways (KR).