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Senator Malala: Do not politicise Mumias Sugar woes

COUNTIES
By Jael Mboga | June 7th 2021

Kakamega Senator Cleophas Malala in South B, Nairobi, on March 21, 2021. [David Njaaga,Standard]

Kakamega Senator Cleophas Malala has urged leaders not to politicise matters around the Mumias Sugar Company (MSC).

Speaking on KTN News today, the senator said parties mustn't make the same mistakes that led to the downfall of MSC.

He said some politicians allied to the Tanga Tanga faction are planning demonstrations against him and ANC leader Musalia Mudavadi.

Malala said such actions as paying youth to demonstrate do not solve MSC's problems.

"It has turned into a political battle so that Mudavadi does not have control over the [Luhya] bloc," the senator added.

Malala added that the investor said he has not been approached by any politician, therefore leaders need to stay away from the matter.

His comments come as Devki Group of Companies withdrew a bid to lease Mumias Sugar Company, Chairman of the group Narendra Raval said on Friday.

The Group had expressed interest in reviving the miller following an invitation by the receiver-manager

“However, given the ongoing public interest which the matter has attracted and the call for a publicly run bidding exercise, we have found it worthwhile to take out our application,” he said adding that the group will express interest should the exercise be conducted in consultation with all stakeholders.

On Thursday, Western Kenya sugarcane farmers and politicians asked the Ministry of Agriculture to stop the proposed takeover of Mumias Sugar Company by a steel manufacturer until due process is followed.

The objection to the debt-ridden miller being leased to industrialist Narendra Raval came after Mudavadi called for transparency in the deal.

Mudavadi has in the past said there is a need to review the taxation structure in the sugar industry to ensure it is attractive to investors and farmers.

The MSC leadership and area leaders are expected to meet tomorrow to chart a way forward on how not to sabotage the company's revival plan. The receivership manager, as well as representatives from the Agriculture ministry, will also appear in the Senate over the MSC matter.

"The best platform to bargain is in the Senate. We need to cushion framers and assure them of minimum returns," Malala said.

Malala said there is a need for transparency in bidding to take over the MSC.

Devki Group of Companies withdrew a bid to lease Mumias Sugar Company. [File, Standard]

He said there is scanty information on the number of bidders, their identity and how the decision was reached on the winning bid.

"Were they [those who lost the bid] denied an opportunity because they are not well connected?" the senator added.

Malala cited Webuye Pan Paper which he said was taken over at a low price.

"Before handing it over to the investor, let's see the value of its assets."

The senator continued, saying the length of the lease should be out in the public and that the investor will be compelled to return the MSC after the lease lapses.

The senator further questioned why an investor has to part with Sh5 billion to pay Sh545 million.

"What happens to the other creditors -- how are they going to be dealt with?"

According to Malala, the national government can do more to help the MSC. He cited the possible wavering of MSC debts like it did for coffee and tea farmers. Malala said the debts owed to the Kenya Revenue Authority, Kenya Power and the Kenya Commercial Bank for MSC need to be cancelled.

"We are not opposed to privatisation ... it is the government's responsibility to ensure money is not misused," he said.

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