Companies

UK firm Camellia disowns Kakuzi in human rights row

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A shopper chooses fresh fruit at a Tesco Superstore in south London on September 30, 2019. Tesco, Britain's biggest food retailer, has suspended the supply of avocados from Kakuzi Kenya, which is accused of systemic human rights abuses in a new lawsuit. PHOTO | AFP

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Summary

  • The Kent-based firm has been sued in the UK by law firm Leigh Day which is representing scores of alleged victims of rape and violence perpetrated by Kakuzi’s employees.
  • Camellia has already spent more than Sh500 million in legal expenses and the move to distance itself from Kakuzi is seen as a strategy to sidestep reparations or fines that may be ordered by the court.
  • With a 50.7 percent stake held through two investment vehicles, Camellia controls the board of Kakuzi to which it has appointed its executives Graham Mclean (as chairman) and Chris Flowers (managing director).

UK multinational Camellia Plc says it does not control Kakuzi’s #ticker:KUKZ board or its day-to-day operations in a bid to distance itself from accusations that the agricultural firm has committed serious human rights abuses in Kenya.

The Kent-based firm has been sued in the UK by law firm Leigh Day which is representing scores of alleged victims of rape and violence perpetrated by Kakuzi’s employees.

Camellia has already spent more than Sh500 million in legal expenses and the move to distance itself from Kakuzi is seen as a strategy to sidestep reparations or fines that may be ordered by the court.

“Kakuzi is a Kenyan farming company, quoted on the Nairobi stock exchange and is led by Kakuzi’s board of directors on behalf of its 3,000 employees and 1,300 (mostly Kenyan) shareholders,” the multinational said in a statement.

“Camellia bought a 50.7 percent stake in the 1990s but we don’t have operational or managerial control, nor control of the board.”

The statement, which came in response to an article on the case by UK’s Sunday Times, directly contradicts the legal and real-world control of Kakuzi.

With a 50.7 percent stake held through two investment vehicles, Camellia controls the board of Kakuzi to which it has appointed its executives Graham Mclean (as chairman) and Chris Flowers (managing director).

“The group is controlled by Camellia Plc, a company incorporated in England. Camellia Plc is the ultimate parent of the group,” Kakuzi says in its latest annual report.

“In implementing the code (of corporate governance), the directors have taken account of the group’s size and structure and the fact that there is a controlling shareholder, Camellia Plc.”

Kakuzi’s second-largest investor is John Kibunga Kimani with a 32.2 percent stake and whose bid to get a board seat was rejected in 2018. Mr Kimani was raised in Kakuzi’s estates and later built up his fortune through professional work and decades of investing.

The remaining shares are dispersed among more than 1,300 investors.

The legal claims have been brought on a no-win no-fee basis, Camellia said, adding that justice will be served.

“Kakuzi is investigating the allegations so that if there has been any wrongdoing, those responsible for it can be held to account and if appropriate, safeguarding processes can be improved,” the multinational said.