Billionaire Narendra Raval has withdrawn his offer to pump Sh5 billion into Mumia Sugar Limited after uproar from Western Kenya politicians.
Kenyan billionaire drops Sh5B investment plan after political interference
The Devki Group Chair had pledged Sh5 billion to help revive Mumias Sugar.
Raval, who is the chairman of Devki Group of Companies was interested in restoring the bed ridden sugar miller from its deathbed and back to profitability.
“However, given the ongoing public interest which the matter has attracted and the call for publicly run bidding exercise, we have found it worthwhile to take out our application.
“We will however express interest ,should the exercise be conducted in consultation with all the stakeholders,” Raval said in a statement.
Mumia is currently under receivership over a Sh500 million debt from a local bank which has invited bids from investors who would like to lease the firm.
Political Interference by Senators
Before the lease was signed, the leaders objected that neither the public nor major stakeholders were consulted.
“I was told that I am the winner, but it is unfortunate that I will not continue with the plans to invest at Mumias because of the new political twist that has questioned the process of selection,” he told Business Daily.
Kakamega Senator Cleophas Malala argued that the Ministry of Agriculture did not explain how the sugar miller’s debts, especially to farmers, would be paid.
“Will the new investor compensate farmers in Kakamega and Bungoma who for years have relied on the miller for their livelihoods?” weighed in Bungoma Senator Moses Wetangula.
According to ANC leader Musalia Mudavadi, Mumias Sugar Company is a critical facility in the region, and residents must be actively involved.
Mumias has been relying on ethanol as the main source of income after other revenue streams such as production of water, cogeneration and sugar production were closed.
The government has so far pumped more than Sh3 billion in attempts to salvage the company which was once Kenya’s largest sugar miller.
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