Kakuzi parent firm to pay final Sh175m for rights abuses

A Security guard stands at the entrance of Kakuzi PLC offices in Muranga County on October 14, 2020. PHOTO | EVANS HABIL | NMG

The UK parent company of Kakuzi, Camellia Plc, says it is set to pay a final installment of Sh175.72 million that is part of a Sh1 billion settlement in a case in which it was accused of alleged human rights abuses.

The multinational had agreed to pay Sh696 million to settle claims arising from its Kenyan agricultural operation under Kakuzi.

It also committed to paying Sh348 million to settle similar allegations brought against its Malawian subsidiary, Eastern Produce Malawi (EPM).

“At 31 December 2021, the group continues to carry £1.2 million (2020: £8.2 million) in respect of the legal claims in the UK based upon allegations against its East African operations, namely Kakuzi in Kenya and EPM in Malawi,” said Kent-based Camellia in a trading update adding this would be the final installment.

“Following discussion with group lawyers, these allegations have now been finalised and no further liabilities are expected to arise, therefore no contingent liabilities are disclosed.”

Camellia owns a 50.7 percent stake in Kakuzi, giving it control of the company.

The multinational says it incurred a total cost of Sh2.35 billion in both legal and settlement fees underlining the impact of the alleged human rights violations against the company.

"Our 2020 results were also impacted by a number of one-off items, the largest of which were costs of £16.1 million in respect of legal and other costs associated with the allegations arising from the actions of certain of our African operations," said Camellia.

UK law firm Leigh Day had initially filed rights abuse claims against Kakuzi in the High Court in London but the assertions were dropped, with the litigation going ahead against Camellia.

As part of the deal, Leigh Day agreed not to bring or support any further claims against any part of the Camellia Group in connection with their operations in Kenya, “for a substantial period.”

The human rights row triggered a major fallout which saw UK supermarkets Tesco, Sainsbury’s, and Lidl suspend the purchase of avocados from Kakuzai in October last year when the issue was reported by The Times of London.

Kakuzi said earlier it has since instituted governance reforms and social investments that include funding charcoal kilns and access to firewood, building two social centres for community meetings, and employing predominantly female safety marshalls.

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