KPCU says Sh900mn worth of assets vandalised

January 22, 2014
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Farmers who had also delivered coffee worth Sh148 million before the firm was placed under receivership are yet to be paid. Photo/FILE
Farmers who had also delivered coffee worth Sh148 million before the firm was placed under receivership are yet to be paid. Photo/FILE

, NAIROBI, Kenya, Jan 22 – The Kenya Planters Cooperative Union (KPCU) board has disclosed that over Sh900 million worth of assets was vandalised during the four years that the company was under receivership.

Board Chairman William Gatei says the assets include a milling machine worth Sh859 million at its headquarters in Nairobi, three coffee huller machines worth Sh3 million each and a computer system in Dandora.

He says they discovered unfortunate developments after they took over the office on December 3 last year, when KPCU was lifted from receivership.

The new board is also having a hard time accessing title deeds of various properties, making it hard for the organisation to get credit to repay its debts.

“The only document we have to show ownership of those assets is a logbook. You know we are required to raise money and you cannot raise money without security. There are banks which want to partner with us but they want security,” Gatei said at a media briefing on Wednesday.

KPCU was placed under receivership in October 2009 after it failed to pay Sh634 million to Kenya Commercial Bank (KCB). Farmers who had also delivered coffee worth Sh148 million before the firm was placed under receivership are yet to be paid.

Deloitte consulting firm was appointed as receiver managers by KCB over failure by KPCU to repay the debts.

Gatei claims that efforts to negotiate with the receiver managers and KCB have not borne any fruits, forcing them to report the matter to the police.

“When we came here and saw the kind of vandalism which had taken place, we had to involve the police who are currently carrying on with investigations. An organisation such as the one that placed us under receivership should be held accountable if they were involved in those activities. But we could only report what we found,” the chairman said.

The board also claims that Sh312 million collected in form of rent during the period cannot also be accounted for.

In November last year, KPCU and KCB made an out of court arrangement to lift the company from receivership and agreed on how to repay its debts it owed the bank, a move that gave hopes to over 700,000 coffee farmers who are shareholders.

But Gatei complains that their hands are now tied since they can’t access credit to go ahead with the payment of its debts and revive the multibillion shillings union.

“We sincerely now want the government to intervene and help us.”

Apart from Sagana mill which has been leased out to third parties, KPCU assets estimated to be worth over Sh3 billion have been lying idle.

He says the firm would need close to Sh2 billion to fully revive it.

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