House teams summon Wako, Kemoli over Busia Sugar

Committees also want former Kenya Sugar Board (KSB) managing director Francis Chahonyo, who cannot be traced, to answer queries on the Sh600 million that was reportedly disbursed to BSC for cane development but was never received.

The summons came as listed miller, Mumias Sugar Company (MSC), was told to vacate the 843-acre land after MPs determined it had recovered the money lent to the controversial firm.

The joint Agriculture and Lands committee dismissed Mumias’ claim of ownership of the land which has purportedly been sold to a private firm, saying it had no right to dispose of it.

Committees’ chairman John Mututho told Mumias management led by CEO Peter Kebati that the memorandum of understanding it entered with BSC for cane supply “did not include any lease or proprietary claim or right over the 843 acre land in Nasewa.”

The MPs said Mumias was not owed anything by BSC for it to acquire the land.

“You have said you made Sh82.2 million during the five years you were at Nasewa and incurred net loss. We will get consultants to ascertain this and in the event you have misled us, you will face the consequences,” Mututho said.

“This will end even sweeter than your sugar when you leave that land to Busia people as soon as possible,” he added.

The House is investigating circumstances under which MSC took over the land from Busia Sugar and put it up for sale to recover Sh55.2 million it had paid to the firm to settle farmer’s dues, which it had not.

READ: MPs probe sale of Busia cane farmers’ land to private firm

Mr Kebati said the company released a further Sh55.2 million which it paid farmers directly in December 2006 for cane deliveries.

Mumias then placed a charge on the land for Sh100 million to recover the money but controversially sold it to Kaplony Limited, a private firm which paid Sh100.5 million to Mumias lawyers.

Wednesday, the committee resolved to hire independent consultants to dig deeper into Mumias’s books of accounts to ascertain whether or not it had recovered its dues, which the company says now stands at Sh124 million including accrued interest.

“We will now go into in-depth investigation on the farming activities of Mumias on Nasewa land for five years. We will get consultants including agronomists to peruse the books of accounts of Mumias and see if it made a net loss as stated by the CEO,” Mututho said.

He said the committee would deal with the issue of ownership of the land and table its report as directed by the speaker.

Appearing for the second time, Mr Kebati failed to satisfactorily explain to the committee the dealing in the land which the government compulsorily acquired from famers to set up a sugar factory and for cane development.

“MSC was affected when there was a hue and cry from farmers who had delivered their cane to our plant through BSC but not paid. We sought the assistant of the Kenya Sugar Board and decided to make a second payment to farmers,” Mr Kebati said.

He said MSC has no interest in the land at Nasewa apart from the Sh124 million debt owed by BSC which holds the title-deed.

“We have no interest in the Nasewa land. We would like to see the factory set up to help farmers. Kaplony Limited which had shown interest in purchasing the land has since rescinded the decision and our lawyers will refund them the Sh100.5 million. We believe that the land should serve its intended purpose,” he said.

He said the cane supply agreement was noble but has since been frustrated through various court cases and the community which was hostile to Mumias.

[email protected]