Anxiety as Mumias Sugar set to close indefinitely over cash problems


Panic has gripped Mumias Sugar Company following reports it will shut down indefinitely on Monday over continued cash problems.

Board chairman Kennedy Mulwa is expected to make the official announcement following a special meeting with other members.

The miller had been shut for three months for maintenance.

Managing director Errol Johnson had said they would fix equipment, which had contributed to the company’s poor performance due to inconsistent maintenance.

The closure from April 11 came barely a month after the cash-strapped miller received Sh239 million from the government, as part of the bailout strategy.

Mumias Sugar has started the search for a new chief executive less than two years after re-hiring Australian Johnston to turn it around.

Johnston‘s two-year renewable term ends in August and he will not seek a renewal.

The publicly-traded company, owned 20 per cent by the state, said interested candidates should apply by May 17.

Read: Struggling Mumias Sugar back in the job market for a new CEO

The listed firm reported a half-year net loss of Sh2.92 billion for the period to December 2016, an 87.07 per cent dip compared to Sh1.56 billion the previous year.

Kenya produces 600,000 metric tones (MT) of sugar per year against a demand of 870,00 MT. This deficit is usually filled by controlled importation from Comesa countries but a ravaging drought in Africa has created a huge shortfall.




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