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Mumias Sugar boss suspended amid probe

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Mumias Sugar Company. FILE PHOTO | NMG

Troubled Mumias Sugar Company #ticker:MSC has suspended chief executive Nashon Aseka over “doubtful” transactions at the struggling miller barely a year after he was appointed.

Board chairman Kennedy Ngumbau said the decision was reached during a special board meeting on Tuesday.

“The reason for suspension was that some doubtful transactions appear to have been into without following due process and requisite approvals,” Dr Ngumbau said in a press statement issued late Tuesday.

“The suspension is meant to pave the way for further investigations into the matter.”

The board of directors of the country’s only NSE-listed sugar miller has named head of agriculture Patrick Chebosi as acting chief executive until further notice.

Mr Aseka was appointed June last year following the shock resignation of Australian Errol Johnston four months before the end of his two-year renewable contract in August 2017.

His appointment came two months after he had been rejected by Nzoia Sugar cane farmers where he had been named CEO in April 17.

Turnaround

Mr Aseka has been trying to win back confidence of farmers in the sugar zone in a bid to urge them to plant more cane to ensure its plant has adequate raw material for crushing.

The company owes farmers about Sh600 million and requires Sh20 billion to settle debts with growers, banks, staff and the taxman.

The government has been piling pressure on the firm's management to come up with a viable turnaround strategy to revive the cash-strapped miller before release of any more funds.

Mumias Sugar had announced plans to cut down its wage bill by reducing the number of employees from 1400 to 700 and slashing allowances paid to senior managers.

The proposals had been forwarded to the National Treasury but government was yet to respond.

A senior official at Mumias Sugar said no concrete agreement had been reached between management and Treasury on the release of additional bailout funds.

READ: Mumias Sugar needs over Sh5bn to stay afloat

ALSO READ: Cash-strapped Mumias told no bailout without job cuts