Businessman Julius Mwale has proposed to give Mumias Sugar farmers Sh. 2.2 billion. This offer is part of a package by the controversial businessman to lure farmers back into sugarcane farming.
The offer comes hot on the heels of a multi-billion offer that Mwale presented for Mumias Sugar through his firm Tumaz & Tumaz.
According to Mwale, the funds will reach the farmers through the Mumias Outgrowers Company for sugar cane development. This will then provide them with a source of capital to venture back into farming.
The businessman further claimed that he will revive Mumias Sugar’s stalled ethanol plant, power generation unit and a water bottling plant with an allocation of Sh. 2.2 billion, Sh. 887 million and Sh. 221 million for each.
The billionaire has offered a bid of Sh. 27.6 billion to take over troubled sugar miller Mumias in a lease program.
According to a report that appeared in the Business Daily, Mwale is a former air force engineer. He is financier behind a project dubbed Mwale City that allegedly seeks “to transform Lunza, a sleepy village in Kakamega County, into a ‘Silicon Valley’ worth at least Sh. 200 billion”.
“The viability, financing and progress of the investment have been questioned by many analysts amid court fights over unpaid contractor dues and regulatory approvals for the project,” the report in the daily said. “Mwale, 45, first rose to the public limelight in 2010 while describing himself as the President and Head of Strategy of US-based SBA Technologies Inc.”
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The successful bidder will take over Mumias, and pay monthly fees to the Kenya Commercial Bank for up to fifteen years. This payment will be made to offset a Sh. 540 million debt that Mumias owes KCB. Additionally, dividends from the company will be used to settle other outstanding debts that are owed to Ecobank and French development agency Proparco. The firm owes Proparco Sh. 1.84 billion secured using the electricity generation plant, Ecobank Sh. 1.77 billion on the ethanol plant. Mumias is also said to owe the National Treasury billions. It also owes commercial banks NCBA and Stanbic Bank a substantial amount of money.