Ameyo opts out of Mumias Sugar board chairman re-election bid

Mumias Sugar Company chairman Dan Ameyo will not seek re-election at the loss-making miller’s shareholder meeting on December 9.

An advertisement published in local dailies indicated Mr Ameyo would not be seeking re-election as a director at the company, ending his two-year tenure at the State-owned sugar miller’s board.

He joined the millers’ board in February 2014.

The move comes amid pressure from western Kenya politicians for board and management overhaul.  Mumias East MP Benjamin Washiali said Mr Ameyo’s exit was part of massive changes expected in the management of the company in the coming six months.

The lawmaker said once the chairman is out, the focus would shift to the management team adding that the current CEO along with his executive team must quit the firm.

Cash-strapped Mumias Sugar named Errol Johnston as chief executive officer last August after receiving a Sh1 billion bailout from the government. Mr Johnston previously headed the company from 1998 to 2001.

“Our main focus is to bring Mumias back on its feet again because it is a source of livelihoods to many people and we want competent individuals to handle it,” he said.

Mr Washiali said the journey to revive the miller had just started and farmers must rest assured that the company would go back to its past profit making ways once “we are through with the restructuring process”.

The miller’s after tax loss grew to Sh4.7 billion in the year ended June from Sh4.6 billion in 2015 as the once vibrant company struggles to return to profitability.

READ: Mumias Sugar losses up as firm blames woes on shortage of cane

The Nairobi Securities Exchange-listed sugar firm has been in financial difficulties blamed on mismanagement, shortage of sugar cane and cash flow constraints.

The miller has so far received close to Sh3 billion from the government for a turnaround plan.

In its financial statement, the sugar miller says it is implementing turnaround strategies with the help of its lenders and shareholders.

These measures include restructuring of its staff, rehabilitation of the factory and increasing the utilisation of the ethanol plant.

Mr Ameyo’s exit comes one week after three legislators from the region asked the Jubilee government to disband the board of directors.

MPs David Were (Matungu), Emmanuel Wangwe (Navakholo) and Mr Washiali said the move would help turn around the miller, adding that nothing tangible had taken place despite the government injecting Sh3 billion into the miller to help revive it.

The directors have also been summoned by parliamentary Committee on Agriculture to appear before them to shed light on the government bailout funds after it emerged the money was mismanaged.