Upon the completion of the talks, the already approved privatisation transactions will kick off immediately and be complete within nine to 12 months, according to the commission/FILE
The commission’s chairman Henry Obwocha says the meetings will mainly involve county governments and sugar cane farmers.
“Prior to implementation, further consultations on the privatisation process will be held with the county governments, the sugar cane farmers and other stakeholders. Accordingly, the commission shall within a period of six weeks roll out a programme for stakeholders consultations and engagements,” Obwocha said.
Upon the completion of the talks, the already approved privatisation transactions will kick off immediately and be complete within nine to 12 months, according to the commission.
The approvals have already gone through the Cabinet, National Treasury and adopted by the National Assembly.
The five sugar companies being privatised are Nzoia Sugar, South Nyanza Sugar, Chemelil Sugar, Muhoroni Sugar and Miwani, with the last two being in receivership.
In the privatisation strategy, there will be sale of new shares comprising 51 percent shareholding of each of the sugar company to strategic partners. The funds from the sale of these new shares will be used in the rehabilitation and modernisation of the sugar companies.
There will also be the sale of 24 percent of the shares of each company to employees and outgrowers through investments trusts, yet to be formed.
“To give farmers more time to mobilise adequate resources to buy the allotted shares, a moratorium of three years has been approved during which the Trusts will be able to buy the shares at the same price at which they were sold to the strategic partners,” Obwocha said.
On the other hand the government plans to retain a 25 percent shareholding in each of the sugar companies but which “It may decide to sell later through an Initial Public Offer or any other method determined at the time of sale to meet the sugar industry and the country’s strategic objective.”
During the process there will also be writing off excess debt as well as conversion of debt to equity of various amounts to revamp the sugar firms as an initial step to creating healthy balance sheets.
