By Joseph Barasa
The
troubles that brought the giant Mumias Sugar Company to its knees have been
well documented. Troubles that caused the once only sterling performer in the
country’s sugar
industry
reduced to a mere shell constantly posting losses year after year forensically
audited.
Troubles
that the government and its agencies of justice have failed to bring to book
the crooks
behind
the mess and recover of the billions that were looted from the company well
publicized, but nothing done but only gloom and doom left to hung over the
miller and millions of people who either directly or indirectly depend on it.
However, there appears to be a ray of hope that the
company
may eventually be salvaged from total collapse.
Mumias Sugar Company
The
appointment of Errol Johnson to become the new Chief Executive Officer of
Mumias Sugar,
may
be just the right dose that the company needed at its most desperate hour. Mr.
Johnson is not
new
at the company and indeed it is on record that he steered that company to the
best of its
highest
performances in its history since establishment in 1976.
Indeed
it is from that background that the government was emboldened to offload the
majority of
it’s shareholding in Mumias Sugar in the
1990s privatization programme. Of all the state owned
sugar
producing state corporations, like Sony, Nyanza, Nzoia, Chemilil, Miwani, and
Muhoroni
only
Mumias became the first and the last to be privatized and listed at the Nairobi
Stock
Exchange
(NSE).
Since
its establishment, the company is the only one in the country’s sugar industry which had
not
been under the management of local government appointed personnel. Booker Tate
Plc of
London
had taken the mantle of the company’s management right from the factory construction
level
to production and management operations.
Therefore
it is from this background that Mr. Johnson found himself at the helm of Mumias
Sugar
as Chief Executive in the mid to late 1990s and one of the first things that
happened was to
brand
the firm, establish a marketing department that embarked on aggressive
marketing and repackaging of the company’s sugar products before marketing them.
Perhaps
one of the most critical factors that many people do not understand about the
sugar
industry
though they enjoy the sweet granules from it is the production processes these
sweet
white
and brown granules have to go through before they end up in the supermarkets
and shops
to
our tables –
particularly the technology involved in the production processes.
During
the reign of Mr. Johnson as Chief Executive under the Booker Tate Management
period,
the
company embarked on one of the most ambitious expansion programmes no sugar
company
in
the country has ever attempted – the introduction of the ultramodern diffuser technology sugar
processing means away from the old and archaic milling processes that are still
being used by the rest of the millers in Kenya.
The
diffuser technology involves chopping up of the sugarcane which is then
processed through
high
pressure diffusion processes to extract the maximum sucrose content from the
sugarcane to
produce
the white and brown granules, while the milling process merely mills the cane
to out
with
the produce.
The
diffuser technology factory which was installed at a cost of more than Kshs. 5
billion in the
late
1990s completely revolutionized the production capacities of Mumias Sugar to
processing
more
than 2 million tones of mill cane annually to produce more than 300, 000 kg of
sugar
annually
thus far outpacing all her competitors on the market.
The
diffuser technology meant highly increased consumption of raw sugar cane by the
factory
which
translated into increased demand for the same from the farmers for the factory
to be able
to
operate at full capacity, in the process more sugar produced and revenue
generated from the
sales
of the commodity to consumers.
It
also meant more bargasse produced which is in turn used to generate electricity
which the
company
sells to the national grid as a byproduct and opened the opportunity to start
an ethanol
production
plant therefore highly increasing the viability and productivity of Mumias
Sugar by
the
time Booker Tate Plc management of London was denied renewal of the management contract
in the year 2000.
High
level manipulations in the government by the powerful cartels owned by the
wealthy sugar
barons
operating mafia style ensured that the multinational corporation was locked out
of Mumias Sugar after babysitting and nursing the company to maturity for a
period of more than
30
years.
Indeed
Mr. Errol Johnson was at the helm of Mumias Sugar when the sugar barons started
fighting
to ensure Booker Tate was locked out just before the end of the retired
president Daniel
Arap
Moi regime. The barons are indeed ruthless, vicious and deadly in their way of
operations
and
in most cases will stop at nothing to get what they want.
Therefore,
the current Nairobi Governor Evans Kidero who was previously managing director,
Nation
Media Group the Newspapers Division must have known about the manipulations and
therefore
it came as no surprise when he was the one who took over from Mr. Johnson as
the first
Kenyan
Chief Executive at the helm of that Company.
It
is from this background that the steady decline of Mumias Sugar started being
recorded,
though
not overtly but activities were reportedly going on at the top level of the
management
including
the Board of Directors that the company had never witnessed before in its
history.
The
first thing that Mr. Kidero did as the company’s Chief Executive was to immediately get rid
of
virtually all top managers of the company that had served under Booker Tate Plc
to replace
them
with his own to begin his leadership of the multibillion shillings sugar
company.
Though
he has persistently denied highly credible audit reports including
parliamentary
committee
on agriculture findings that implicated him in the huge losses Mumias Sugar has
incurred,
Mr. Kidero is yet to be taken off the hook in relation to massive malpractices
at that
company
that brought it to its knees.
With
the exit of Mr. Kidero, Mr. Peter Kebati entered the scene as the Chief
Executive of the
giant
milling company but what has clearly emerged is the fact that the giant was
already
mortally
wounded and slowly but surely limping to its death bed unless otherwise
salvaged.
Though
the government has already injected into the ailing company more than Kshs. 1
billion to
try
and resuscitate it, that is a far cry for what must be done if the company has
to be completely
Salvaged
from total collapse and steered back to possible total recovery.
That
is why the entry or recall of Mr. Johnson to head the company at its most
desperate hour by
the
government may be the lifeline that the company needs considering the man’s highly nonsense professional style
of management that saw Mr. Kidero inherit a gold mine to manage
only
to leave a gutted ghost in the hands of Mr. Kebati who did not survive at the
helm for long.
However,
the most critical matters here are that there must be a total overhaul of the
company
board
of management to be completely replaced by new blood and Mr. Johnson to be
given a
totally
completely free hand in the management without any external interferences – but above
all
the government must also use its power to completely neutralize the notorious
mafia like
cartels
operating in the country’s sugar industry.
As
for Mumias Sugar Company it is indeed extremely important that thorough
forensic audits are
conducted
from the time when Booker Tate’s management contract was terminated and some of
the
most critical projects that must be put into focus should include the
tarmacking and street
lighting
of the Shibale to the factory road, the construction of the company’s administrative
headquarters
in Mumias, the ethanol processing project, the bottled water project, the construction
of the sugar cane buying centres projects among others.
Indeed
it goes without saying that those who are found to have been involved in the
massive
looting
of the company must be brought to book and the assets and monies the company
lost
recovered
and restored to its rightful owner – this just part of the daunting task that Mr. Errol
Johnson
is facing to turn around the country’s giant miller.
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