Business tycoon Jaswat Rai is claimed to have acquired the financially troubled Kisumu Molasses Plant from the Jaramogi Oginga Odinga family for Ksh7 billion.
It is reported that the Molasses Plant, which has been experiencing problems for close to five years, started facing the financial challenges when Mumias Sugar Company went under.
For many years, Mumias was the main supplier of molasses, its raw materials.
The firm which is based in Otonglo was acquired by the Odinga’s in 1995 during a public auction using Kisumu Development Trust and was inaugurated in 1997.
It is noted that at the time, members of the public contributed money towards its purchase but there has not been any annual general of late.
Later on, the Kisumu Development Trust, a registered entity with its own articles of association and directors, elected by the registered contributors of the Ksh1.8 million, used the money to purchase 5 percent stake at the plant.
However, despite its outstanding success in the past, residents near the plant have been up in arms over land related issues and pollution by the firm.
By the time of its downward spiral, the government-private partnership had invested about Ksh170 million in the venture to produce ethanol.
Besides acquiring the molasses, Rai is alleged to planning a buyout of several other ailing sugar companies including the Dominion Farms in Siaya and Miwani Sugar Company.
Rai is stated to also own Raiply Mills, Rai Cement and the Webuye Paper Mills alongside Sukari Industries and West Sugar Company.
This is despite opposition from a meeting held by a sugar task-force appointed by President Uhuru Kenyatta, led by the chairman of the Kenya National Sugar Alliance Saul Busolo.
In a separate meeting co-chaired by Kakamega Governor Wycliffe Oparanya and Agriculture Cabinet Secretary Mwangi Kiunjuri, the task force had recommended that state-owned sugar firms should be privatized.