Sony Sugar Management On Patronage Martine Dima, the New MD, Cuts A Multimillion Deal That Proves Costly To The Loss Making Company

Just when it has started milling sugar again, the troubled state-run SonySugar which has been on significant recovery path, up from gross revenue of 400m in 2019 to 5.132 billion in 2022/2023 is in a downward spiral due to alleged mismanagement by new MD.

The MD who lives luxurious life, running around with car hire vehicles from one specific car hire company based in Kisumu and yet the company vehicle is available. Since car hire company bills are paid for by Sony, it’s believed that car hire company is owned proxy or associates. The MD is ever out of the office and can hardly take a full week in the office.

Anonymous customers speaking to Kenya Insights claimed that the MD, while Nairobi, Kisumu and Nakuru is mostly spotted with suppliers and sugar customers to bargain or negotiate for price cuts and fictitious contracts. Evidence from payments records in finance indicate that taxis claims are paid upto the tune of Kshs 250k to 300k per week. This excludes his per diems which is to the tune 100k to 200k per week. The MD has spent over 3.5m in 6months as compared to kshs 600,000 spent in a whole financial year by former MD.

Clients in Nairobi claim that the MD has several businesses (cleaning/car hire services ) in Nairobi which is supervised by his PA and Insurance assistant who is chairmans daughter, both in Sony payroll. The staff are based in Sony Nairobi office.

The MD was sacked by Migori County Government on grounds of malfeasance. He appealed unsuccessfully.

He was never vetted for public service jobs under Chapter 6 of the constitution. It’s claimed that he bribed his way to avoid the mandatory Chapter 6 requirements. That means he has the protection of the Board chairman, Kilimo House, Treasury, and the state organs that are responsible for vetting. Dima v Migori County Secretary 2 others (Miscellaneous Application E068of2022) 2023KEELRC81(KLR) (25January2023) (Ruling)

Bloated Bill

The management on patronage of the New MD, has also cut a deal that defies ethical & profitable businesses decisions.

The contentious matter is :MIGORI HCCC NO.24 of 2015 NGINA GITIBA -VS- South Nyannza Sugar Company Ltd in which the the Lady Litigant filed a suit whence a Migori Court errered in its judgement which court relied on fabricated prayers by Ngina Gitina.

Investigations by Kenya Insights extracted documents that revealed that Ngina Gitina had only 5 Acres under cane which were harvested then delivered to the Miller.

The documents in our possession indicated she was given seed cane and fertiliser which the company would recover from the payment due from the 1st harvest (1st Ratoon) totalling to
Kshs 2,670,042/= ONLY.

Ngina Gitina, (read a farmer) Kshs 2,670,042/= being the value of cane delivered but not paid for.
Case in court sought compensation for damages for breach of an ALLEDGED CONTRACT No. A and B by failing to harvest sugarcane from the farmers plot to the tune of Kshs. 39,599,225/=.

On account of the initial decretal ammount of 2,670,042/=, the matter proceeded which gave rise to a QUESTIONABLE total amount payable to the plaintiff (farmer) as damages as at the date of judgment on 14th/2/2019 consequence upon the award is Kshs. 62,868,771/= inclusive of interest but excluding costs as such costs of the suit. This decision is /was yet to be ascertained either through taxation or agreement.

THE LIES

The said farmer harvested one plant crop. The court errred to award for an EXTRA 2 (Two) Ratoons, plant crop which were not harvested.

The court decided to ignore the actual value of the sugar cane which the farmer realized after harvesting & applied a speculative estimate for the entire crop circles, has committed an error of law.

There is no way the farmer can be paid the cost of developing cane, over and above the value of the cane yield realized from the plot. It is a grave and fundamental error of law for the court to have awarded to the plaintiff both the costs of producing cane plus the value of such cane when it is harvested.

3. The court failed to take into account the COST of developing the cane which the COMPANY INCURRED in assisting this farmer despite appreciating that such costs are to be taken into account by making appropriate deductions from the realized sugarcane value.

4. In short, the court made fundamental errors of both law and fact which can be corrected on appeal.

5. Okongo Wandago, the appointed company lawyer advised Sony Sugar MD to take the matter to an appelate court which advise Sony Sugar CEO ignored!

6. The big story began_ When the the MD Martine Diana DISREGARDED, company attorney’ and counsel to appeal instead opted to enter into a private treaty with the farmer to pay the FLAWED decretal amount.

On 6th August 2024, on utter disregard to profitable economic practice, the Managing Director signed an agreement to pay the fictitious Kshs 95,515,950/= to the farmer.

Attached are the minuted that show how the MD indulged the Sony Sugar Board Chair Hon Jared Opiyo.

Devolution Human Rights Defenders Forum, a Homabay lobby group has also written to the DCI seeking to probe the scandalous deal.

“It has come to our attention that instead of paying the principal award of Kshs. 42 million as directed by the High Court of Kenya, South Nyanza Sugar Company Limited have entered an out of court settlement arrangement in which an inflated payment of Kshs. 95,515,950 will be paid to Ngina Gitiba in instalments of which a fraction of the same has been paid. This agreement disregards an appeal filed by the company whose fate is not known.” Reads part of the letter in our possession.