Govt abandons Dairy leasing

Apr 06, 2005

THE Government has abandoned the leasing of Uganda Dairy Corporation to Malee Sampran, a Thai company.

By Mary Karugaba

THE Government has abandoned the leasing of Uganda Dairy Corporation to Malee Sampran, a Thai company.

Appearing before the finance committee yesterday, privatisation state minister Prof. Peter Kasenene said the Government was, however, proposing a management contract with a Thai businessman, Chatchai Boonyarat.

Kasenene said after a tour of Thailand last month, the Government dropped the leasing process in favour of a management contract.

The delegation which visited the company comprised finance committee chief Bright Rwamirama, Beatrice Kiraso and Kalule Sengo and technocrats from the Privatisation Unit that sponsored the tour. “We realised that the investor could not provide the investment plan requested by Parliament,” he said to surprised MPs.

The MPs welcomed the management contract but called for a competitive process.

This was the third time the Government changed the dairy firm’s divestiture after dropping competitive bidding last year.

Kasenene said with the management contract, the Government would retain 100% shares and only change managers.

He said the terms would be negotiated once Boonyarat agreed to bring in his expertise in milk and fruit processing.

“There is no doubt about the man’s skills and experience in milk and fruit processing. The Government wants to tap his market in Europe, America and Asia,” he said.

However, the discussion was interrupted when MPs asked Kasenene to explain why the Government was involved in drafting a lease agreement with a non-registered company, Pan African Foods.

Rwamirama (Isingiro North) asked him to explain why the Government had to do a due diligence report on Malee yet the agreement was with Pan African Foods.

Kasenene said, “This is just a draft which was to be sent to the Attorney General for approval before the signing would take place.”

The MPs insisted that he names the officials who drew the agreement and also names the company’s shareholders.

Kasenene said the document was drawn by the PU and that he needed time to name the actual officials.

He said he could not name the shareholders of Pan African Foods because the company was not registered.

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