KAKAMEGA, Kenya, Feb 18 — The protracted dispute over the lease of Mumias Sugar Company to a Ugandan-based firm will proceed to a full hearing following decision by the High Court in Kakamega.
Petitioners in the suit had challenged the decision by Mumias receiver manager PVR Rao to award the lease to Sarai leaving other bidders who had given higher quotes including Tumaz and Tumaz Enterprises Ltd, a local firm that challenged the award.
The County Government of Kakamega had filed a lawsuit on January 10, 2022 against Rao and Tumaz to stop interfering with Sarai Group lease for Mumias arguing that the county will lose revenue if the court did not intervene.
Lawyer James Orengo who represented the county government supported the court’s ruling. Tumaz and Tumaz was represented by Nelson Havi.
Tumaz and Tumaz which bid Sh27.6 billion against Sarai Group’s Sh11.5 billion obtained judicial review orders from the High Court in Nairobi on December 29, 2021 , suspending the lease. The firm argued that the bidding process was marred by fraud, mistakes and illegalities.
The Mumias lease suspension by the High Court in Nairobi will remain in place until Justice Anthony Ndung’u rules on March 3.
A separate case filed by Mumias sugar farmers and other bidders in January was heard by Justice Wilfrida Okwany at Milimani court Nairobi.
The judge suspended Mumias lease until March 14 to allow the parties to be enjoined in the suit.
The farmers claimed that the bidding process was opaque and the lease was awarded to the lowest bidder Sarai group for Sh5.8 billion without regulatory approvals.
The Competition Authority, a State corporation mandated to review acquisitions and mergers, filed a submission in the farmers case saying it had not received any documents for approvals from both Rao and Sarai.
Creditors subsequently filed suits against the two firms seeking to reverse the lease award.
