6 September 2012

Kenya: Investors Eye Closed Corn Factory

SEVEN investors including two politicians want to buy the collapsed Corn Products Kenya factory at more than Sh3 billion after farmers failed to acquire the firm last week. The farmers are said to have disagreed with the American owners of the company over a Sh200 million bank purchase guarantee.

The investors are said to be negotiating to buy the company and the 20-acre land on which it stands near the New KCC factory in Eldoret. However, the company's officials declined to comment on the sale talks saying the matter is being handled by directors, who are currently in the United States.

"You can call them and talk to them. I am just here as part of the team overlooking security issues of the factory and assets," said one of the officials. The farmers' bid to buy the factory collapsed after they failed to raise deposit. Higher Education minister Margaret Kamar and Kenya Farmers Association director Kipkorir Menjo were leading the negotiations to acquire the factory through a cooperative society.

However, sources say the farmers will make another bid through Kokwatai Co-operative after a meeting scheduled for next week in Eldoret. During a meeting with Prime Minister Raila Odinga in Eldoret, Kamar said the company has rejected their offer and intends to sell the land where it is located. "That lands belongs to the government. Let them take away their machines and leave us with the land and the buildings," said Kamar. She said farmers will use the assets to start their own milling company through a co-operative society.

Raila promised to ensure the assets revert to the farmers. He added that the government will help farmers set up the milling plant. The firm, which has been buying 700,000 bags of maize from farmers annually, collapsed last month rendering more than 500 employees jobless. The closure has affected close to 5,000 people, who rely on the company.

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