The New Kenya Planters Co-operative Union (New KPCU) has taken over assets valued at Sh7 billion from its liquidated predecessor, yet faces urgent challenges including incomplete ownership records, expired leases, and deteriorating infrastructure. A 2020 liquidation report by Stephen Kamau Njoroge and Anthony Maina Waithaka revealed systemic issues that led to the collapse of the original KPCU, established in 1937 as a coffee farmers' institution.
Prime Assets in Dispute ¶
The liquidators identified over Sh3 billion in assets, including Nairobi CBD properties like Wakulima House and Twin Tower Old Mills valued at Sh3.47 billion. However, title deeds for these properties remain unresolved, with land charged to Pink Homes Ltd for Sh138 million despite no recorded transactions linking the company to KPCU. Similar issues plague Dandora coffee mills and Sagana's leased premises, where expired leases and unverified ownership complicate asset recovery. A 1968 lease for Sagana's mill had expired without renewal, according to the report.
Financial Liabilities Mount ¶
Despite using Sh200 million from the Coffee Cherry Advance Fund to settle a Sh185 million KCB loan, KPCU's remaining liabilities include Sh220.6 million in unverified legal fees, Sh40.6 million in unpaid directors' allowances, and Sh46 million to Virtue Over Seas PTE. Over 1,811 growers owe Sh4.5 billion, with six individuals owing Sh862.4 million and two others Sh1.2 billion. The report noted that official searches showed land charges to third parties without documented creditor relationships.
Decaying Infrastructure ¶
Key facilities face severe degradation, with 20 of 49 milling machines obsolete and 17 requiring immediate replacement. Sagana's mill, operating under a 1968 lease that expired without renewal, holds machinery valued at Sh37 million. Dandora's plant and machinery are assessed at Sh24.27 million, while Nairobi's Wakulima House furniture and vehicles are worth just Sh16 million. Liquidators emphasized the need to recover outstanding grower debts or consider waivers to stabilize the organization.
Legal and Operational Hurdles ¶
New KPCU's legal team is tasked with retrieving ownership documents from the predecessor's records and negotiating lease renewals. The liquidators urged recovery of outstanding grower debts or waiver considerations, emphasizing the urgent need to stabilize the organization amid its complex financial and operational legacy.
