In Summary
  • Ms Kimeto said in the court documents that although the current management had promised to turn around the firm, this has become an almost impossible task.
  • She pointed out that the company has been plagued by extremely high management and staff turnover.

Mumias Sugar Company got into more trouble as five more creditors joined a petition seeking to wind up the miller for failure to pay its debts.

The five joined the case on Thursday, bringing the number of creditors who are pursuing the dissolution of the once-vibrant sugar miller to more than 50.

Lawyer Jackline Kimeto sought to wind up the troubled sugar miller over a debt of Sh76 million. Ms Kimeto is demanding her dues for representing the company since 2015.

Some 43 others sued as a group, accusing the company of failing to pay them a total of Sh57.5 million.

Other creditors are Osho Chemicals, Milicons Ltd and Proparco, one of the largest secured creditors and who financed the construction of the power plant at MSC.

The Kakamega County government, which has put together a committee to oversee the planned revival of the company, and a law firm — Wekesa Simiyu — have also joined the case.

LEGAL FEES

In court documents, Ms Kimeto argues that she represented Mumias Sugar in various cases and provided legal opinions as agreed between them. Whereas she did her job, the management is yet to honour its part of the bargain.

She said her law firm and the sugar company entered an agreement to provide legal services on April 22, 2015 as well as render advisory work, of which she sent fee notes. These have been taxed and judgment has been entered for the amount.

She filed the case arguing that the board of directors and the management seems to be unable to turn around the affairs of the company and make it meet its obligations to its creditors, as well as to properly account for the proceeds from the operations of the company.

“It is quite clear that in spite of the numerous written communications, the company has and continues to incur liability; that it is insolvent and unable to pay its debts as they fall due or can only pay if compelled by orders of the court,” reads part of the application filed in court.

Page 1 of 2