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Portland: Land tussle costs us Sh10m a day

FINANCIAL STANDARD
By Lee Mwiti | February 16th 2016
East African Portland Cement

The East African Portland Cement Company (EAPCC) has found itself in an unfamiliar position. It is embroiled in a land dispute over 13,000 acres in Athi River that contain its most important mines.

The country’s oldest cement maker claims it is battling powerful cartels in its attempt to regain access to the land.

The issue is now taking a political dimension and fanning tribal hostilities, with claims that the area’s dominant communities are taking back land that historically belonged to them.

Colonial government

EAPCC Managing Director Kephar Tande says he has heard all manner of stories about the land. As if resigned to constantly having to defend the listed firm’s claim to the property, he draws out original title deeds that had been safely locked up at a local bank but have since been moved to his office.

“The 13,000 acres that are being snatched from us are divided into three parcels, and here are their titles,” Mr Tande said.

The first old, large document for LR/7815/1 indicates a 99-year lease from 1948. It shows it was bought in 1977 from the now defunct East African Sisal Estate Limited.

The second title for LR/8784/4 also has a 99-year lease from 1962, and shows it was allocated to the company by the colonial government. It is located just behind Daystar University. When EAPCC valued it more than four years ago, it was worth Sh800 million. Market prices have since shot up, and the land is now worth Sh8 billion.

The third reads LR/10424, and like the others, has a 99-year lease from 1962 and was also allocated by the colonial government. It extends from the Kenya Meat Commission (KMC) past Athi River all the way to the railway line.

But various groups have also laid claim to the land, and have documentation to back them up.

However, the National Land Commission (NLC) has recognised the land in question belongs to Portland and compensated them for about 102 acres acquired for construction of a section of the standard gauge railway (SGR).

EAPCC was paid Sh610 million last year after NLC completed its own investigations into who owns the land.

The Government has a 52 per cent stake in the cement firm, while French multinational Lafarge holds 42 per cent; the rest is held by private individuals.

The Government’s investment in EAPCC is held through the Ministry of Industrialisation, the National Social Security Fund and the Treasury. It has baffled EAPCC’s management that despite the Government’s involvement in the company, the tussle over land ownership persists.

“We have been in contact with the Machakos County commissioner about the issue, and yet, whenever police are deployed to guard the property, they are later quietly withdrawn,” Board Chairman Bill Lay said.

“Our Industrialisation Cabinet Secretary has corresponded with the Interior Cabinet Secretary, but still we see no light to getting the individuals who have encroached upon the land kicked out.”

Negative publicity

The firm says the land issue has negatively impacted on operations, and it now expects to lay off 25 per cent of its employees — about 1,500 workers, largely miners.

The company said it depends on mines in the disputed land for supplies, but with the current disruptions, there has been inconsistent supply.

“The individuals on the land have closed our mines and attack our workers whenever they show up. We are losing revenue. We are losing Sh10 million a day,” Mr Tande said.

“The loss of revenue and the inability of our workers to access the mines has impacted negatively on our daily operations.”

The company’s land woes and negative publicity over the issue have also scared away potential investors and left its management struggling to figure out how to clean up its brand, Tande added.

Machakos County leaders are trading accusations over the issue, with some officials siding with EAPCC. Others, however, say the land belongs to the squatters who have settled there, and the company has been denying them the right to live on the property.

EAPCC’s management has moved to court to get a determination on the rightful owner of the property. In the meantime, settlement structures continue to be put up on the land.

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