Mumias disputes indefinite factory closure claims

Lack of sugarcane availability has forced listed sugar miller Mumias to shut down its factory.

The out of crop closure(OCC) is a normal procedure used by sugar companies to rehabilitate their machines as they build up enough sugarcane stocks to crash.

However the sugar miller has denied claims that the shutdown is indefinite, adding it will continue evaluating cane availability before restarting operations.

In a notice to shareholders, Mumias Chairman Kennedy Mulwa said there was nothing out of the ordinary with the factory closure, adding the mill was still in business.

“We are concerned that this miscommunication has caused a lot of discomfort among our stakeholders and now expect that this clarifies the situation,” Mr Mulwa said.

The chairman said during the shutdown period, Mumias will continue giving its contracted farmers the usual husbandry services as well as other related services.

Unavailability of sugarcane has been a major challenge for Mumias which continues to slide into losses.

Mumias half year loss stood at Sh2.92 billion largely on cane shortage.

Mumias is said to be eyeing a third government bailout package to turnaround its fortunes.

Already the government has sunk Sh3 billion into Mumias which helped the miller sought out farmer debts.

Already Mumias chief executive officer Errol Johnston has already stated his intent to exit the company at the end of his contract term in August, forcing the board of directors back to the drawing board to search for new CEO.