Sarrai Group, a Ugandan-based company has won a bid to take over control of Mumias Sugar company. In a statement released on Wednesday, December 22, Mumias Sugar administrator, Ponangipalli Rao, confirmed that the Ugandan-based company had won the bid to take over the embattled company. It was also revealed that the decision was made after a bidding process that lasted for four months pursuant to a November court ruling.
“I hereby confirm awarding the Leasing of assets belonging to Mumias Sugar Company Limited to Sarrai Group, Uganda. The Lease is in the interest of all stakeholders and in conformity with the recent Court ruling dated 19th November 2021,” the administrator stated. However, Rao revealed that the Ugandan Company will not take control of the company’s ethanol and cogen plants which are part of the factory.
In the statement, the lease deal was defended as Rao noted that the Ugandan company had overseen the production of three brands of sugar in Uganda. Further, it was clarified that the Ugandan company has no relation with Kenyan-based Rai Group who owns a sugar company in the country. “Sarrai Group has no association with entities under Rai Group including West Kenya Sugar Company,” read the statement.
The embattled sugar company has faced financial challenges for close to 10 years with the government forced to step in to cushion the farmers who have complained of delayed payments by the company.