KCB dealt major blow in Mumias Sugar leasing bid
Venkata Ramana Rao will keep maintaining his status as the receiver manager for Mumias Sugar Company following the Commercial and Tax Division-based court ruling that was issued last Friday.
Other four applicants were dismissed in the case paving way for Rao to proceed with the leasing process of the once giant sugar miller in the country.
“The receivership of the Company will run concurrently with its administration. Rao will also act as an administrator in addition thereto for purposes of reporting to this Court on the administration of the Company,” Judge Mabeya’s ruling read in part.
“For the avoidance of any doubt, the 2nd respondent (Mr Rao) shall continue to act as the receiver-manager of the Company on behalf of the 1st respondent (KCB Bank) and as per his appointment”.
In the rulling also, Rao will be obliged to give the court a financial statement of the receivership since his appointment in 2019, report financial operations to the court after every six months and give all creditors status quo within 60 days.
The respondents, Mumias Sugar Company and KCB Bank have been restrained from directing Rao on how to carry out his obligations and conduct his business.
This even as the court shot down orders that were meant to prevent the Senate from interfering with the miller’s receivership by summoning the receiver-manager.
“Since the matter touched on public interest, each party is to bear its own costs,” Justice Mabeya ordered.
The miller through a private treaty between the investor and the bidders received a total of eight leasing bidders according to Mr. Rao as stakeholders move to revive the miller back to its glory days.
Businessman Julius Mwale, placed the highest bid of Ksh27.6 billion, steel tycoon Narendra Raval offered Ksh8.4 billion through his Devki Group, while billionaire Rai family through West Kenya Sugar offered Ksh3.5 billion.
Mwale, a businessman and a Kenyan entrepreneur has set aside Ksh.2.2 billion for Western Kenya sugar cane farmers to whip them back into the businesses as talks to revive Mumias Sugar company are underway.