Mumias Sugar Mismanagement Claims False, Says Kidero
By Felix Olick
NAIROBI Governor Evans Kidero yesterday blamed the managers of the Mumias Sugar Company for its dwindling fortunes and insisted that his nine years as CEO reversed its “steady loss-making path”.
Kidero issued his statement in response to media articles that followed a report by audit company KPMG, and a statement issued at the Nairobi County Assembly last week by Nairobi Senator Mike Sonko.
Kidero maintained that he left the company in a sound financial state, having made Sh48 billion as cumulative profits.
“The people who have since been charged with running the company should answer questions on the woes betiding MSC. With insignificant changes here and there, the Board of directors remains the same as it was when I joined the company,” Kidero said.
“The present Managing Director (Coutts Ottolo) was a member of the Board and the chairman of the Finance and Audit committee of the Board. It is deceitful for any one of these directors to feign ignorance on the things they approved while I served under them,” said Kidero.
Kidero insisted that when he was MD, MSC had clean audits and its operations were aboveboard. He said that if the dubious deals had been the practice, both internal and external auditors would have captured them and raised queries.
“While the KMPG draft report remains just that – a draft report – it’s disturbing that it forms the basis for unfounded, highly damaging and actionable allegations,” Kidero maintained.
“Allegations of unilateral award of tenders, sale of export sugar on the local market and irregular procurement are entirely devoid of any grain of validity.”
Kidero said Mumias was in a management crisis before he took over and made a loss of Sh244,858,000 in 2002. Kidero was the Managing director between October 2003 and June 2012.
“In June 2012, I left MSC in a very sound financial state. In my last financial year as MD, the company made a net profit of Sh2.6 billion,” Kidero said, warning that the explanation for the company’s floundering fortunes would not be found by pointing fingers at “innocent people”.
He revealed that the Board has since increased the chairman’s stipend to Sh450,000 per month while the MD pockets Sh2 million monthly.
“Board members collect sitting allowances of KSh45,000 per sitting per member. They sit almost every day. It’s not difficult to tell what ails MSC,” he concluded.
Last week, Senator Sonko tabled documents in the county assembly to prove that a network of people who had been involved in irregular deals in Mumias have now camped at City Hall, with their companies taking many tenders.
He named the people behind the companies as Kidero’s chief of staff George Wainaina, Kula Mato, Yunis Ibrahim Khalif and Peter Hongo.
YH Wholesalers had a contract with Mumias to obtain 13,450 tonnes of sugar at a discounted price of Sh1.14 billion. It has since been given various tenders by the Nairobi City County Government.
One of the directors of YH Wholesalers is Ibrahim Khalif Mohamed who is also a director at Alpha Grain Millers, which shares the same offices as another company doing business with the county government, Sifa Bins. Sifa Bins, which has a contract to collect garbage in parts of Nairobi, has been managed by Peter Hongo, a former business development manager at Mumias Sugar.
The three directors of Sifa Cleaning and Bins services include Joseph Kula Mato, who is also a director of Quids Enterprises Ltd. Another director of Quids is a company known as Lopiding Transporters Ltd, whose postal address is 69 Lokichogio. This is the same address registered to another company, Loki Merchants Limited, whose directors are George Wainaina and John Njogu.
Wainina and a relative, John Wainaina, are also the directors of The Cups Limited, which has also been doing business at the county.
Sonko also questioned by lawyer Tom Ojienda, who is Kidero’s family lawyer, has been appointed a Nairobi City County lawyer.