Uganda Company Takes Over Mumias Sugar

  • A photo of the entrance to Mumias Sugar Company
    A photo of the entrance to Mumias Sugar Company
    File
  • Sarrai Group, a Ugandan-based company has won a bid to take over control of Mumias sugar company.

    In a statement released on Wednesday, December 22, Mumias Sugar administrator, Ponangipalli Rao, confirmed that the Ugandan-based company had won the bid to take over the embattled company.

    It was also revealed that the decision was made after a bidding process that lasted for four months pursuant to a November court ruling.

    Mumias Sugar
    Mumias Sugar
    Kenyans.co.ke

    “I hereby confirm awarding the Leasing of the assets belonging to Mumias Sugar Company Limited (in Receivership & under Administration) [MSCL] to Sarrai Group, Uganda.

    “The Lease is in the interest of all stakeholders and in conformity with the recent Court ruling dated 19th November 2021," the administrator stated.

    However, Rao revealed that the Ugandan company will not take control of the company’s ethanol and cogen plants which are part of the factory.

    In the statement, the lease deal was defended as Rao noted that the Ugandan company had overseen the production of three brands of sugar in Uganda.

    "The group employs over 20,000 employees across its regional business. In the sugar sector, its track record include 20,000 hectares of its own nucleus estates in Uganda, with a sugar production that includes Kinyara sugar, Hoima sugar and Kiryandogo Sugar with a total capacity of 19,000 tonnes crushed per day," read the statement in part.

    Further, it was clarified that the Ugandan company has no relation with Kenyan-based Rai Group who owns a sugar company in the country.

    "Sarrai Group has no association with entities under Rai Group including West Kenya Sugar company," read the statement.

    On his part, Sarrai Group MD, Mr Sarbi Rai, state that his first step towards reviving the company would be revamping the factory's infrastructure.

    “Mumias sugar was the most respected sugar company not only in Kenya but the entire region and it is our firm commitment to all the stakeholders that we shall use all our experience and resources to make sure that we revive the company and take it back to the heights it once enjoyed,” he stated.

    The embattled sugar company has faced financial challenges for close to 10 years with the government forced to step in to cushion the farmers who have complained of delayed payments by the company.

    Sugarcane being transported on a tractor.
    Sugarcane being transported on a tractor.
    File