Mumias
Sugar board of directors under Dan Wameyo is a worried lot. It moved to suspend
several managers at the company over what they termed sabotage and impropriety.
The 27 followed Peter Kebati
the chief executive officer and Paul Murgor of marketing who were sent home.
The recent casualities among others are agriculture and engineering manager a
one Nyagah, Julius Were and a son of former director Osundwa.
In what is seen by farmers as
“addressing the symptoms and not the disease, the board argued that these
individuals had also not proved their capability in steering the company into
profitability soon as promised at the AGM.
Farmers want the root cause of
the troubles addressed including the dissolving of the entire board which is
accussed of foiling to make the forencic audit report public since it has
implicated many of them. One director James Chege is said to have been paid a
cool Sh100 million to supply fridges for Mumias Springles Water to be
distributed to various outlets. Suprisingly his firm imported only 200 of them
and pocketed the rest.
At the meeting held at Tom
Mboya Labour College in Kisumu months back. The acrimony, the drama and the
noise raised by genuine farmers and hired hoodlums has refused to died down.
Away from the sugar-coated lies by the management and the sweet promises of the
political leaders present and the board of directors, the books of account of this company state a different
case. The company is headed in the abyss.
It does not need an accountant
or any other financial expert to realize that the picture painted by MSCs
annual reports and financial statements of 2013 is grim because the company
stands at a Sh10b risk exposure.
Without declaring how they
intend to mitigate the risks, Mumias Sugar Company’s audited accounts are a
“true reflection of the state of affairs at Kenya’s premier sugar miller”.
Page 83 of the financial
statements shows that the once glittering firm borrowed Sh5billion to finance
electricity generation, water and ethanol plants and the new office block. This
was several years ago and the projects are even yet to rake in the much
anticipated proceeds.
Mumias Sugar, the accounts
show, owes trade suppliers Sh3billion money borrowed to run their day-to-day
activities as they anticipated to supply sugar to the traders. This has come a
cropper. Sugarcane has been uprooted and the crushing capacity has sunk.
The banks are also on the neck
of the company as overdrafts stand at Sh1billion due to borrowing to settle
debts and pay farmers who in turn are also owed Sh700million in unpaid dues.
The government through the
Agriculture ministry lent the company Sh500million to pay farmers but this cash
is a drop in the ocean as it failed to meet the target.
This money, deposited in a
separate account is said to have been eaten partly by three board members
namely Chege, Francis Kipkoech and Nimrode Namenge. Over Sh1million distributed
to spies based in Mumias to buy their silence on the future prospects of the
company.
The company boards of
directors and the management have for long now failed to heed the warning shots
by their auditors year in year out. The reason, they are involved in
multi-million shillings scam.
With net revenue of Sh12
billion and a pre-tax loss of Sh2.2 billion, MSC is on record that its
expenditure was Sh14 billion. This is a company whose management is living
beyond their means, care free and little regard for the farmers.
Shameless individuals are
eating into the company, they are driving the company to its edge as
stakeholders including politicians and the government addresses the symptoms
with no seriousness in seeing that it stands.
It is said Kebati, who
worked as the financial director and
then CEO was afraid to raise the red flag that the company faces imminent
collapse because he could be held accountable. Mumias owes Kebati Sh100million
which he is demanding.
Funny enough it is under his
tenure in finance department that the company over committed itself in mindless
projects, he failed to advise board of directorss on the long term effects of
the cash cows.
It is on these grounds the
Ameyo board has held him accountable.
The forencic audit report
shows the purchase of sugar, molasses and supply of electricity and importation
of sugar was fishy. It was in total contravention of the company policy in
dealing with banking institutions. To complicate matters is the deals with a
Sudan sugar firm and importation and repackaging of sugar in Mumias branded
packages with a section in management involved.
As this is happening, Mumias
Sugar board of directors is pushing Coutts Otollo for a three years old
contract in office so as to protect them from being exposed. Otollo before
being named in the current position was a director on board.
The finance department and the
legal one-headed which was headed by axed Emilly Otieno according to the report
were engaged in dubious payments. Proniment law firms are said to have invoiced
and paid for services not offered.
A secret account running into
billions was created to deal with the Sudan Kagera sugar firm by finance
department to hide suspect dealings.
No comments:
Post a Comment