The parent company of Kakuzi Limited #ticker:KUKZ, Kent-based Camellia Plc, is bracing itself for claims running into hundreds of millions of shillings arising from alleged human rights abuses in its African operations.
The multinational disclosed in a trading update that it had spent Sh462 million to prepare its legal defence against the charges of various crimes including assault and sexual misconduct.
The alleged abuses were carried out by its employees in its African subsidiaries, which were not identified specifically.
Kakuzi, however, has separately reported that it has also recently received claims in legal battles whose nature was not disclosed. It was not immediately clear whether Kakuzi is part of the units that have generated the potential liability for Camellia. Camellia’s operations in Africa include Kakuzi (in which it owns a 50.7 percent stake), Eastern Produce Kenya, Eastern Produce Malawi, Eastern Produce Cape (South Africa) and Eastern Produce Tanzania.
“As we stated in our trading update of January 2020, Camellia and a number of its subsidiary companies have received notification of claims to be made in the UK relating to allegations made by multiple individuals concerning two of those companies' African operations,” the multinational said in disclosures to its investors.
“The allegations are of serious assault, harassment and sexual misconduct allegedly committed by certain individuals employed by those two foreign operating companies.”
Camellia said it takes any complaint of criminality, misconduct, illegality, or unethical behaviour extremely seriously.
The multinational said it cannot, at this time, quantify the financial impact of these claims but added that it is incurring substantial costs in legal advice. “Costs incurred since notification of these claims in 2019 to the end of March 2020 amount to £3.5 million (Sh462 million),” Camellia said.
Kakuzi, meanwhile, has also disclosed in its latest annual reports that it recently received claims whose details it did not disclose. “Various claims have been submitted against the group in relation to different litigations,” Kakuzi says in its latest annual report.
“It is not practical to estimate the potential effect of these claims but legal advice indicate that it is not probable that a significant liability will arise.”
Kakuzi has over the years battled various claims and charges, including allegations that it is the beneficiary of thousands of acres of land that was originally acquired illegally from locals during the colonial days.