NAIROBI, Kenya, October 16 – The Government has ruled out selling the New KCC Sotik factory to private investors, saying the planned restructuring will retain public ownership while allowing farmer-owned entities to run some commercial operations.
In a statement, the Ministry of Cooperatives and Micro, Small and Medium Enterprises Development said New KCC would retain ownership of the factory, machinery and other assets under the proposed leasing arrangements.
The clarification follows concerns raised by Sotik MP Francis Sigei over the factory’s future and the impact of the changes on dairy farmers, workers and suppliers.
The Government says the restructuring is intended to improve operations, increase farmer participation in milk processing and marketing, and ease working capital constraints at the state-owned processor.
The Sotik factory received about Sh153 million for modernisation between the 2016/17 and 2020/21 financial years. The investment included replacing old machinery and increasing processing capacity by 100,000 litres of milk per day.
New KCC has faced financial and operational challenges, including delayed payments, underused processing capacity and accumulated debts.
The Ministry said outstanding payments to farmers, suppliers, employees and other creditors were being verified with relevant government agencies, including the National Treasury. It did not disclose the total amount owed or when the payments would be made.
The Government said safeguards would be put in place to protect public assets and define responsibilities for maintenance, inspections and accountability under the proposed arrangement.
