Court extends orders stopping privatization of five sugar companies

The High Court has extended orders stopping the privatization of five sugar companies in Western Kenya.

This comes after the court in April 2016  issued an order to stop the privatisation of the five sugar companies for a period of two months, following an urgent case contesting the sale.

In his ruling, Justice Weldon Korir further prohibited the Privatisation Commission from proceeding with the sale of Nzoia, South Nyanza, Chemelil, Muhoroni and Miwani sugar companies until it is properly and legally constituted.

The court said the commission should only proceed with the sale after consultations and participation of all stakeholders is done and thorny issues ironed out.

Kisumu Senator Anyang Nyongo and Gem MP Jakoyo Midiwo had moved to court claiming the sale process was being conducted illegally, following placement of an advertisement in the newspapers on March 11th this year.

Through their lawyer Victor Obondi, the two ODM legislators say the commission ignored mandatory and material procedure and conditions prescribed for the privatization process of the subject companies, while issues raised by cane farmers had not been addressed.

The two leaders had also sued the commission and the Attorney General as interested parties in the matter.

In May 2015, Kenya approved the sale of the government’s stake in five sugar companies; Nzoia, South Nyanza, Chemelil, Muhoroni and Miwani.

In a statement published in the local dailies, the Privatization Commission announced its plans to sell 51 percent of each of the millers to strategic investors with a track record of managing sugar companies further indicating that the proceeds would fund the rehabilitation and modernisation needs of the sugar companies.

Last year, the government approved the sale of the government’s stake in Nzoia, South Nyanza, Chemelil, Muhoroni and Miwani sugar companies.