High court extends orders suspending Mumias lease

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The revival of Mumias Sugar company will wait longer after the High Court extended orders barring Ugandan company, Sarrai Group, from commencing operations at the sugar mill.

The order blocking Mumias Sugar takeover remains in place pending the hearing and determination of a petition filed by five Mumias Sugar cane farmers-cum- investors.

Justice Wilfrida Okwany on Tuesday, January 25, said the interim orders will remain in place until March 14, a day scheduled for the hearing.

The judge ruled that the case by five shareholders-cum-farmers was urgent “and worthy of the orders to protect the subject matter” and in consequence dismissed an application filed to lift the orders.

The five farmers include Lambert Ochochi, Augustino Saba, Prisca Ochacha, Robert Magero and Wycliffe Ng’ong’a.

The group filed the suit against the statutory manager, Attorney General Kihara Kariuki, the Agriculture CS, Gakwamba Farmers’ Cooperative the Competition Authority of Kenya, PV Rao KCB’s receiver-manager, KCB,  Sarrai Group Ltd, the Chief Land Registrar, the County Government of Kakamega and the Capital Markets Authority.

Lawyer James Orengo representing the County Government of Kakamega opposed the six-week window given to the five farmers.

The window was issued for farmers and shareholders to prepare for the trial.

Justice Okwany also allowed West Kenya Sugar Company Ltd, through Senior Counsel Paul Muite and lawyer Martin Gitonga, to join the suit.

Sarrai Group is being dealt a blow for a third time now after the high court first stopped it from taking over Mumias.

On January 14, 2022, Justice Okwany stated that the case required halting the activities and actions that have been complained of to enable Sarrai and other respondents to file their responses.

His orders came a day after a Kakamega high court set aside an order directing Sarrai Group to proceed with works at Mumias Sugar Company. The order was petitioned by the Kakamega county government.

The Kakamega order which vacated an earlier order was made by Justice William Musyoka.

This was after Tumaz brought to the attention of the court that there was a pending order issued by Justice Ndung’u on December 29th, 2021 at High Court in Nairobi barring Sarrai from going on with works at the company.

Justice Musyoka stated that the County government failed to inform him of the December 29 order.

Sarrai Group won the lease despite allegedly placing the third-highest bid of Ksh11.5 billion in the lease battle, while Tumaz & Tumaz placed the highest bid of Ksh27.6 billion.

Tumaz sued Mumias’ receiver-manager Ponangipalli Venkata Ramana Rao citing fraud, mistakes and illegalities in the bidding process.

According to Tumaz’s lawyer Javier Munzala, the receiver-manager failed to give all the bidders an open and transparent opportunity, compromising the integrity, fairness, and accountability of the process.

He also argued that the tendering process was so secretive that it was impossible to know who won the tender.

This prompted the high court to suspend the lease.

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