Kinyara Sugar sale may collapse again
THE divestiture of Kinyara Sugar Works Ltd (KSWL) hangs in balance, following President Yoweri Museveni’s directive to the finance ministry to offer the factory to a local firm.
By Sylvia Juuko
THE divestiture of Kinyara Sugar Works Ltd (KSWL) hangs in balance, following President Yoweri Museveni’s directive to the finance ministry to offer the factory to a local firm.
This is the second time the sale has been interrupted after the Government abandoned the initial public offer (IPO) in November 2003.
The directive contained in letter dated January 19 said the sale of Kinyara should be expedited and “given to an investor capable of consolidating the sugar sector in Uganda.â€
The directive contravenes the ongoing international competitive bidding process that had attracted seven companies which were pre-qualified by the Privatisation Unit for the 51% stake in KSWL.
The Madhvani Group Consortium is the only local company.
Other companies include Deep River Beau Limited and Groupe Quartier Francais (Mauritius) Industrial Promotion Services (UK), Libyan African Investment Foreign Company (Libya), Illovo of South Africa, Olam International Ltd (Singapore) and Rai Group (Kenyan).
The companies had concluded due-diligence and were slated to move to the technical financial bidding stage between March and April.
The other 49% shareholding would be sold to the public (19%), Bunyoro Kingdom (10%), employees (10%) while outgrowers would get (10%).
Sources say the Government may face grave consequences from the companies that have invested and participated in the bid process if the President’s directive is followed.
However, privatisation minister, Prof. Peter Kasenene, said they had not thought of the implications because no action had been taken about the directive.
“Since we have not decided what we are going to do about the letter, we have not thought about the implications of those who have participated in that process,†said Kasenene.
Kasenene who declined to discuss the matter further, insisted that the process has not been interrupted yet.
“As far as I know, there is nothing new. If there is anything we will let you know.
All I’m saying is that there is a process that started and if there was any change in that process, I will let you know,†he said in an interview yesterday.
If the President’s directive is implemented, it would violate the Divestiture Act and Procurement Procedures outlined by the Public Procurement and Disposal of Public Assets Authority.
THE divestiture of Kinyara Sugar Works Ltd (KSWL) hangs in balance, following President Yoweri Museveni’s directive to the finance ministry to offer the factory to a local firm.
This is the second time the sale has been interrupted after the Government abandoned the initial public offer (IPO) in November 2003.
The directive contained in letter dated January 19 said the sale of Kinyara should be expedited and “given to an investor capable of consolidating the sugar sector in Uganda.â€
The directive contravenes the ongoing international competitive bidding process that had attracted seven companies which were pre-qualified by the Privatisation Unit for the 51% stake in KSWL.
The Madhvani Group Consortium is the only local company.
Other companies include Deep River Beau Limited and Groupe Quartier Francais (Mauritius) Industrial Promotion Services (UK), Libyan African Investment Foreign Company (Libya), Illovo of South Africa, Olam International Ltd (Singapore) and Rai Group (Kenyan).
The companies had concluded due-diligence and were slated to move to the technical financial bidding stage between March and April.
The other 49% shareholding would be sold to the public (19%), Bunyoro Kingdom (10%), employees (10%) while outgrowers would get (10%).
Sources say the Government may face grave consequences from the companies that have invested and participated in the bid process if the President’s directive is followed.
However, privatisation minister, Prof. Peter Kasenene, said they had not thought of the implications because no action had been taken about the directive.
“Since we have not decided what we are going to do about the letter, we have not thought about the implications of those who have participated in that process,†said Kasenene.
Kasenene who declined to discuss the matter further, insisted that the process has not been interrupted yet.
“As far as I know, there is nothing new. If there is anything we will let you know.
All I’m saying is that there is a process that started and if there was any change in that process, I will let you know,†he said in an interview yesterday.
If the President’s directive is implemented, it would violate the Divestiture Act and Procurement Procedures outlined by the Public Procurement and Disposal of Public Assets Authority.