A firm linked to Mombasa County Governor Hassan Joho will make billions from lucrative SGR bulk cargo transportation deal.
Grain Bulk Handlers Limited (GBHL) and Autoport Freight Terminals Ltd (AFTL) were granted huge discounts to move cargo from Mombasa to Nairobi.
The two firms will enjoy preferential rates to transport cargo over a 10-year period at up to 80 percent discount.
This is against the maximum volume discount of 10 percent allowed in Kenya Railway Corporation’s (KRC) tariff book.
The two companies negotiated with KRC into granting them a special rate of Ksh45,000 to move a wagon of loose cargo from Mombasa to Nairobi, down from the normal fee of Ksh214,700.
In order to receive this special deal, AFTL convinced KRC it will move 1.6 million tonnes (24,615 wagons) annually while GBHL promised to transport 4.3 million tonnes (66,153 wagons).
Under the subsidized rate, Autoport will pay Ksh1.1 billion instead of Ksh5.28 billion it would have parted with under normal rates.
According to Sunday Nation, AFTL is linked to the family of Governor Joho while GBHL is owned by influential businessman Mohamed Jaffer.
In addition to the preferential rates, KRC agreed to lease two facilities in Nairobi to the two companies for a period of 45 years.
GBHL was leased 60 acres while Autoport got 26 acres.
