SonySugar’s New MD Under Fire for Alleged Mismanagement and Extravagant Spending

Nairobi, Kenya – December 27, 2024

SonySugar, the state-run sugar company that had been on a remarkable recovery trajectory, is now facing a significant downturn, with allegations of mismanagement leveled against its new Managing Director (MD), Martine Dima. The company, which saw its gross revenue jump from Sh400 million in 2019 to Sh5.132 billion in the 2022/2023 financial year, is now caught in a web of financial impropriety and questionable business decisions.

Insider sources and anonymous customers have provided Kenya Insights with details of the MD’s lifestyle and business practices, which include the use of car hire services from a specific company in Kisumu, despite the availability of company vehicles. This car hire company, suspected to be owned by associates or proxies, charges SonySugar between Sh250,000 to Sh300,000 per week for taxi services alone, not including the MD’s personal per diems, which range from Sh100,000 to Sh200,000 weekly. Over six months, the MD’s expenses allegedly totaled over Sh3.5 million, a stark contrast to the Sh600,000 spent annually by his predecessor.

Further allegations suggest that while the MD is frequently out of office, visiting Nairobi, Kisumu, and Nakuru, he engages with suppliers and customers, negotiating price cuts and entering into potentially fictitious contracts. Reports also indicate that he oversees several personal businesses in Nairobi, managed by his personal assistant and the chairman’s daughter, both employed by SonySugar.

The MD, previously sacked by the Migori County Government for malfeasance, managed to bypass Chapter Six vetting of the Kenyan Constitution, allegedly through bribery, ensuring protection from the Board chairman, Ministry of Agriculture, Treasury, and other state organs.

In another controversial move, the MD has been involved in a contentious legal settlement related to the case MIGORI HCCC NO.24 of 2015 NGINA GITIBA -VS- South Nyannza Sugar Company Ltd. Here, the court’s judgment, which many argue was based on erroneous calculations, awarded farmer Ngina Gitiba Sh62,868,771 for damages, including interest, for cane not harvested. Investigations have shown that Gitiba only had 5 acres under cane, and her legitimate claim was for Sh2,670,042.

Despite advice from the company’s lawyer, Okongo Wandago, to appeal the decision, the MD chose to settle privately, agreeing to pay an inflated amount of Sh95,515,950. This decision has not only raised eyebrows but also led to accusations of financial misconduct, with the Devolution Human Rights Defenders Forum from Homa Bay writing to the Directorate of Criminal Investigations (DCI) to probe this deal.

Critics argue that the court ignored the actual value of the cane and the costs incurred by SonySugar in assisting the farmer, leading to a judgment that overcompensated for what was harvested. The decision to pay this “fictitious” amount was made without regard for the ongoing appeal, further exacerbating the company’s financial strain.

This series of events paints a picture of a company once on the mend now spiraling due to leadership that seems more focused on personal gain than organizational health. The community, stakeholders, and watchdog groups are calling for an immediate investigation into these allegations, demanding accountability and a return to ethical and profitable business practices at SonySugar.

As this story develops, the focus will be on whether state authorities will take action to rectify these issues and restore SonySugar’s trajectory towards recovery and integrity.