Change of guard at Magadi Soda

Magadi Soda Company is Africa’s largest soda ash manufacturer, producing almost 40 per cent of global output and one of Kenya’s leading exporters.

Soda ash, a vital component in the production of glass, detergents and various chemicals is also used in the manufacture of pharmaceuticals, baked goods, toothpaste and deodorants.

Details of Mr Mathenge’s exit remained sketchy, but the Business Daily learned that Michael Odera, Magadi’s long-serving director of sales and marketing, has taken over his position in an acting capacity.

Mr Odera could not be reached for comment and neither could Tata Chemicals; Magadi Soda’s parent company.

Expansion plans
A change in fortunes for the soda ash manufacturer over the last one year after costly expansion plans is, however, leading to speculation over Mr Mathenge’s departure.

For the first time in years, production of Soda ash fell by 28.3 per cent in the first half of the year compared to an increase of 28 per cent within the same period last year.

According to the Central Bank of Kenya, in the first six months of 2009, Magadi Soda Company experienced challenges in marketing through stiff competition from cheaper synthetic exports from China, forcing closure of some plants and subsequently reduced production.

Soda ash mining for the first half of 2009 amounted to 173,731 metric tonnes, compared with 241,926 metric tonnes mined in the same period in 2008.

On average, monthly output of soda ash in January – June, 2009, was equivalent to 28,995.2 metric tonnes and between January and June, 2008, it was 40,321 metric tonnes, a difference of 11,365.8 metric tonnes per month.

Last February , Magadi was forced to shut down its Sh7.7 billion plant for two weeks to cut costs and ease storage problems arising from the slow movement of its products.

In July, Mr Mathenge had told the Business Daily that Magadi Soda was yet to resume to full capacity but things “were getting better” following a resumption in demand in the firm’s key export destinations.

Chinese producers who industry players say were quicker to cut prices after the commodity bubble burst late last year continue to raise the stakes in the soda ash business.

The helm
That Tata Chemicals could now turn to Mr Odera who has been with the company for the last 30 years points to an aggressive strategy aimed at recovering lost market share, how to handle the threats from far east competitors while seeking out new markets for the firm’s products.

Mr Odera, who is now 57, joined the company in 1979 and has — according to Magadi — received accolades for setting sales records for five consecutive years since 2000 through the developments of new markets in Africa and Asia.

Market observers say Mr Odera’s candidature for the top job is boosted by his intimate knowledge of the company’s operations and is matched only by a previous managing director, Mr Titus Naikuni.

Mr Naikuni joined the company in the same year as Mr Odera, only leaving on 2003 to take up his appointment as Kenya Airways’ chief executive officer.

Mr Mathenge earned his stripes at oil marketing firm Caltex Oil Kenya, serving as the firm’s managing director and country chairman between 1998 and 2003.

The oil marketer which later changed its name to Chevron Kenya Ltd has since been bought out by another oil marketer Total Kenya Ltd. Mr Mathenge who currently seats on the board of Kenol Kobil.