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Mumias firm now seeks Sh2b bailout

By Dalton Nyabundi | Sep 26th 2018 | 2 min read
By Dalton Nyabundi | September 26th 2018

The management board of Mumias Sugar Company has asked the Government for an urgent Sh2 billion bailout to help it resume operation.

The miller has also opened talks with sugarcane farmers in efforts to start crushing again.

Board Chairman Kennedy Ngumbao said the heavily indebted firm was rooting for at least Sh500 million from the Treasury to kick-start production.

“We submitted a request for at least Sh2 billion, but we understand it may come in tranches, so we are hoping for about Sh500 million to set us off,” he said.

Mr Ngumbao said they were also in talks with relevant Government agencies and creditors over the firm’s Sh20 billion debt.

Mumias Sugar owes Kenya Power alone Sh2 billion, while another Sh1 billion is owed to the Kenya Revenue Authority in unpaid taxes.

Workers who are owed over Sh700 million in arrears stretching back 17 months last week shut down the factory’s ethanol plant in protest to push for the payment.


The Mumias board has recently come under attack over allegations of misappropriating up to Sh3.6 billion bailout cash as well as more than Sh15 million proceeds of the ethanol plant.

Speaking to The Standard on the telephone yesterday after the board was accused of spending the Sh15 million in a cane hunting trip and bringing back nothing, Ngumbao said they had secured assurance of good cane supply once the firm resumes operation.

The claims were made by the Kenya Union of Sugarcane Plantation and Allied Workers Secretary General Francis Wangara.

Mumias, once the largest miller with capacity to crush 9,000 tonnes of cane daily, crushed a paltry 1,000 tonnes before its recent closure despite the injection of more than Sh3 billion in bailout.

Its woes have seen the acreage under cane fall from 220,000ha about 10 years ago to below 100,000ha.

The inefficiency rocking Mumias has also dragged down public millers’ total installed crushing capacity from 35,000 tonnes of cane per day to just over 3,000 tonnes.


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