As Mumias Sugar engineers an ambitious recovery, its top managers are set to be fired and prosecuted for gross mismanagement of the firm. Strikingly, the expected prosecutions are to include both current and former managers. Agriculture Secretary Felix Koskei, says that an elaborate plan to revive the firm, including immediate replacement of top management, months after audit firm KPMG unearthed major scandals that forced the country’s largest miller to its knees.
“The legal process has taken its course on each and every individual that has been found culpable in whatever manner on what has brought Mumias Sugar to its knees,” Mr Koskei wrote.
Already, the firm has announced vacancies to head all departments – almost seven months since chief executive Peter Kebati and commercial director Paul Murgor were fired. The duo were involved in criminal activities including illegal sugar importation in a scam that cost Mumias Sugar more than Sh1.1 billion. No charges have been brought before the two, while we could not determine if any progress had been made on threats of surcharging them.
But yesterday’s decision to sack even more executives was reached after years of investigation into the collapse of the miller by the agriculture committee of the National Assembly. A final report is, however, yet to be tabled amid claims of a split in the committee orchestrated by people who were implicated in the scandal, several committee members have told ‘The Standard’ in separate interviews.
In an attempt to show fresh resolve, Mr Koskei added that the State would ‘not watch as they walk free and enjoy ill-gotten wealth’ in his threat. He, however, did not reveal any names, but was specific about a board directive to replace top managers. “The Mumias Sugar board has already approved the advertisement and recruitment of staff with requisite competences, work ethics and culture to drive the company back to where we would all want to see it.”
Towards turning around the fortunes of the firm, Mr Koskei said that the State had come up with a bouquet of measures that would reverse the miller from the downward spiral it is on. Among them is a Sh500 million bailout that would be released within the week to enable the firm in settling its current overheads.
Mumias Sugar has sunk to its lowest, turning losses for successive years and losing more than half of its market share locally. In just two years, the miller has reported Sh4.3 billion in cumulative losses – attributing the poor performance to illegal imports of sugar that complicated its marketing. Even with the claims from the management and board, Parliament had evidence that the Mumias Sugar bosses were culpable in the very fraud.
