Mumias Sugar is back on store shelves almost a decade after the giant grinder stopped processing, with the company catching up with rivals that have snatched up its market share during the years it has been idle.
The return of the brand to the market comes at a time when the supply of goods is not enough, where businesses had to partly rely on expensive imports in an effort to satisfy the market.
Mumias Sugar Company has the largest processing capacity in the country, with a crushing capacity of 8,000 tons of sugarcane per day and a core sugarcane nuclear of 4,000 hectares.
Since mid-month, Mumias sweetener has been retailing at all major supermarkets in Nairobi. It first went on sale in a two-kilogram pack worth SH 289 compared to other brands selling for SH 312.
The return of Mumias Sugar is a win across the economy as it will benefit every stakeholder starting from the farmers who sell the raw material to the factory, to the host community who benefits from business growth and employment opportunities in the region, and finally to the rest of the supply chain system.
“The sugar is being received well, so far so good,” said Wily Kimani, Naivas’ chief operating officer.
The Rai brothers- Jaswant Rai of Kabras Sugar and Sarbi Singh Rai of Sarrai Group – are currently jostling for sugar market share after the latter won a lease to revive Mumias.
Sarbi Singh Rai is one of five sons of the late Tarlochan Singh Rai who passed away in December 2010. Sarbi was at odds with the sibling over the division of property left by the patriarch, forcing him to leave the Rai Group, whose chairman is Jaswant.
Debt Encroachment and Receivership
In September 2019, KCB Group was assigned the right to take over Mumias Sugar Company as a receiver in order to protect its assets and maintain its operations.
However, the lender was prohibited from auctioning off the plant to secure the property to be used as collateral for other loans, prompting the lender to consider leasing.
Mumias Sugar owes Proparco KSh1.84 billion secured for the power plant project, Ecobank KSh1.77 billion acquired for setting up the ethanol plant, and KSh 2.83 billion owed to the Treasury.
Nevertheless, Mumias still owes other banks (KCB, NCBA, and Stanbic bank) more than KSh 3 billion.