Nyeri businessman faults government for asking locals to acquire stakes in their own company

Nyeri,

Friday, December 29, 2023,

KNA, By Wangari Mwangi 

Nyeri 2022 gubernatorial aspirant and business mogul, Dr Thuo Mathenge, has faulted proposals by the Privatization Authority to ring-fence some of the shares to communities living near some of the parastatals that are lined up for privatization by the State.  

Speaking in Nairutia, in Kieni-West Sub-County, Dr Mathenge said in the case of the New Kenya Cooperative Creameries (KCC) in Nyeri County, the people of Kiganjo are the bonafide owners of the milk processing plant and as such it is not practical for the government to sell the plant or to ask the owners to purchase shares from their own company.

“We are the ones who donated the land on which the KICC sits and we paid all the rates and taxes as required by law and therefore KCC Kiganjo belongs to us. You cannot buy something that belongs to you and we are therefore asking the president not to sell our KCC,” stated Dr Mathenge.

Dr. Mathenge’s sentiments come two weeks after the Privatization Authority revealed that communities living near 11companies earmarked for privatization by the state would be allocated some shares during the privatization drive. According to the Authority’s Chief Executive Officer, Joseph Koskey, ring-fencing was aimed at managing the interests of locals who have some form of attachment to the entities. 

Further, Koskey noted that the move will only apply to companies whose sale will be open to the public through the Nairobi Securities Exchange through Initial Public Offering, commonly referred to as IPO.

“This will apply if there is this particular company based in some region and people within that particular locality feel that this is ours because it is on our ancestral land. We can say that because these people have some attachment to this company, we can a percentage stake on the sale. If we they don’t fully subscribe to what they have been allocated, then we sell the remainder to other people,” stated Koskey.

In November, the National Treasury Cabinet Secretary, Prof Njuguna Ndung’u announced a privatization drive targeting 35 state companies in a move that would partially help the government raise revenue.

Prof Ndung'u said the 11 of the companies would be on boarded on the 2023 Privatization Programme in accordance with the Privatization Act 2023 Section 21 (1). The companies include the Kenyatta International Convention Centre (KICC), Kenya Pipeline Company (KPC), New KCC, Kenya Seed Company Limited (KSC) and National Oil Corporation of Kenya (NOCK).

Others are the Kenya Literature Bureau (KLB), Western Kenya Rice Mills Ltd (WKRM), Numerical Machining Complex Limited (NMC), Vehicle Manufacturers Limited (KVM) and Rivatex East Africa Limited (REAL) and the Mwea Rice Mills Ltd (MRM).

The total asset value for the 11 companies is estimated to be more than Sh 190 billion.

Courtesy; KNA