Benson Kathuri
1 May 2008
Nairobi — The New Kenya Co-operatives Creameries (NKCC) might lose property worth more than Sh600 million to land grabbers.
NKCC chairman, Mr Matu Wamae, said the company had for the last four years tried to recover the land and buildings that were grabbed in the late 1990s.
According to the Controller and Auditor General, Ms P Komora, the milk processing company does not have title deeds to claim ownership of 38 parcels of land and buildings worth Sh601million.
In the company's audited report, Komora said the company is yet to recover additional Sh4.9 million from a Tanzanian company that imported milk last year but failed to pay. "We have all along tried to recover the property but it appears that some cases might end up in the court of law," said Wamae.
He was speaking at the Dandora plant after announcing last year's trading report.
He said the management that took over in 2003 could not locate title deeds and other documents that would enable them to reposses the land.
The company might also lose another 27 parcels of land and buildings, nine of which are located in Nakuru district.
"In addition, four title deeds for property valued at Sh536 million are charged in a commercial bank as collateral and are in custody of the bank," read the report in part. It said the company could have paid a supplier Sh78.5 million for goods that were never supplied.
The report said the company lacked documents to confirm that the goods that include plant and equipment existed.
"I have been unable to ascertain the ownership of the respective land parcels and buildings without title deeds or to confirm the carrying values of non-current assets as at June 30, last year," said Komora.
During the meeting, Cooperative Development minister, Mr Joseph Nyaga, said the company would be sold to the farmers after its operations stabilised.
The company with asset base of over Sh6 billion was initially owned by dairy farmers before a few individuals bought it and turned into private property in the late 1990s.
In 2003, the Government bought it back at Sh530 million and embarked on rehabilitation of the 11 milk factories that had collapsed.
Wamae hinted that the company will be handed over to the dairy farmers who will then be advised to sell part of the holding through the Nairobi Stock Exchange.
"The revival of NKCC has turned dairy into one of the most dynamic sectors in the region and throughout the country," said Nyaga. "It has greatly enhanced payment to farmers from Sh7 a litre in 2003 to the current pay of Sh21."
The company has also paid Sh130 billion as dividends to the Government for the trading year ending June last year.
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