Cash strapped Mumias Sugar has sent packing all its employees, a month after being placed under receivership.
In a statement by Ponangipalli Rao, the receiver appointed by KCB Bank, the sugar milling company will henceforth hire on temporary basis but will give priority to past employees.
“Consequent to the company being placed in receivership, all employees contracts stand terminated from the date of receivership i.e 20th September, 2019,” the statement read in part.
Read: Raila’s Ailing Kisumu Molasses Plant Sold Off To Asian Tycoon Jaswant Rai At Ksh7 Billion
The company will also duly compensate all the affected persons, the statement further stated.
“Any payment to the affected employees shall be dealt with in accordance with the provision of the law.”
“Accordingly, the Receiver shall engage the services of any employee on a temporary basis on mutually agreeable terms until the time when the operations resume. Priority will however be given to the past employees while recruiting the staff on temporary basis until the time when the company’s operations are revived,” it further stated.
In September, the troubled miller was placed under receivership by KCB which controls 1.72 per cent shares, in a bid to protect its assets and to the best extent maintain its operations.
Mumias Sugar is partly owned by government which has over the years tried to bail out the struggling company with fail, with a 20 per cent stake and 10 other companies.
Individual shareholders hold the majority shares at 71.35 per cent.
The insolvent company last released its financial results in 2017 for the year ending June 2016, recording a net loss of Sh4.73 billion and revenue of Sh6.29 billion.
Last year Ecobank Kenya, KCB and Commercial Bank of Africa demanded payments of loans amounting to Sh1.7 billion, Sh480.1 million and Sh364.5 million loans respectively.
Email your news TIPS to Editor@kahawatungu.com or WhatsApp +254707482874. You can also find us on Telegram through www.t.me/kahawatungu
Email your news TIPS to Editor@Kahawatungu.com — this is our only official communication channel
