Investor offers Sh2.2bn to Mumias Sugar farmers


Entrance to Mumias Sugar Company. FILE PHOTO | NMG

Businessman Julius Mwale, who placed a Sh27 billion bid in the leasing of ailing Mumias Sugar, has proposed a Sh2.2 billion to farmers in a bid to woo them back into sugarcane farming.

Mr Mwale, through his Tumaz & Tumaz Enterprise, said the money would be channelled towards growers through the Mumias Outgrowers Company for sugar cane development, providing farmers with a ready capital for venturing back onto farms.

Farmers in Mumias abandoned sugar cane growing over three years ago after the company failed to pay their dues, with thousands of growers turning to other crops such as maize.

However, the Sh2 billion could act as an incentive to attract back growers who had for long relied on sugar cane as their mainstay crop.

The entrepreneur says he will also allocate funds in reviving the stalled ethanol plant, power generation unit and a water bottling plant with an allocation of Sh2.2 billion, Sh887 million and Sh221 million respectively.

The power generation unit was a key component of the miller’s income, contributing close to 20 percent of its revenue. However, its production and that of the ethanol plant stalled when the firm failed to get sugar cane for milling to provide the raw material for the two plants.

The Mwale City investor topped the bids in its offer to run the troubled miller for 20 years with a Sh27 billion bid, trouncing steel billionaire Narendra Raval, whom through his Devki Group offered Sh8.4 billion while Rai under his West Kenya Sugar placed Sh3.5 billion.

He commits to spending Sh5.5 billion to upgrade the rundown production plant.

“T&T has demonstrated a track record for building new enterprises with big positive impacts for the local community, from building healthcare facilities and offering free healthcare to private investment in tarmac roads,” said Mr Mwale in a statement.

The company will allocate Sh2.2 billion each for the construction of an airport, agriculture research university, a sugar tourist resort, a housing project and for putting up a hospital within the Mumias Complex.

The entrepreneur has received a commitment of a $200 million (Sh22.1 billion) loan from a top American bank to boost his chances of winning the lease.