Nairobi — The sale of four million Kenya Seed Company (KSC) shares went on despite a Government directive halting it, a court was told on Monday.

A retired deputy secretary in the Ministry of Agriculture, Mr Douglas Mwasagha, said the sale of the shares through private placement had been put on hold pending Government approval.

He told Nairobi Chief Magistrate, Aggrey Muchelule, that former Finance Permanent Secretary Mwaghazi Mwachofi and the Investment Secretary wrote to former KSC managing director, Nathaniel Tum, directing him to stop the sale.

The retired senior official was giving evidence in which Tum and eight former KSC directors are accused of arbitrarily issuing 4 million shares through private placement, which diluted the Agricultural Development Corporation (ADC) shareholding in the seed company.

"There were two letters produced which directed the exercise to be stopped. Tum said he received the letters but they came too late after they (KSC) had already started the process," he said.

Led in his evidence-in-chief by a Senior State Counsel, Mrs Alice Ondiek, it emerged that the Public Investment Committee (PIC) also raised questions over sale of the shares.

"The Agriculture PS, Prof Shem Migot Adhola, was called to one of the PIC committee meetings and the issue became a national one, so it was referred to the Inspector of State Corporations," he said.

According to the witness, the sale of the 4 million shares to the public would have had the effect of reducing Government's interest in KSC and make it private controlled.