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Tag: privatization

  • KPC debuts on NSE as state seeks to privatize more SOEs

    KPC debuts on NSE as state seeks to privatize more SOEs

    Privatisation could help Kenya unlock value from mature public assets while easing pressure on public finances according to President William Ruto.

    Speaking during the bell ringing for the Kenya Pipeline Company IPO, whose proceeds have been channeled into the National Infrastructure Fund, President Ruto said the Fund model would reduce reliance on taxes and sovereign debt to finance development.

    “Through this innovative funding model, we are easing pressure on the national budget, reducing taxes, and cutting on sovereign debt. This is how we will transform Kenya in our lifetime,” said the President.

    The bell ringing signalled the start of trading for Kenya Pipeline Company shares.

    Privatisation of KPC netted the government Ksh 106 billion, which is significantly higher than about Ksh 5 billion in annual dividends the state was receiving from the firm.

    The government now plans to leverage the seed fund to attract private investment in order to finance large-scale infrastructure projects across the country through the Ksh 5 trillion fund.

    “Using the National Infrastructure Fund, whose enabling law I signed on Monday, we will leverage the Ksh 106 billion to crowd in private capital and raise KSh1.2 trillion to finance the development of mega transformative infrastructure projects,” President Ruto added.

    The Kenya Pipeline Company shares that opened for trading at Ksh 9 shillings per share hit 9 shillings and 40 cents.

  • Govt committed to clearing unpaid dues owed to sugar workers, Kagwe says

    Govt committed to clearing unpaid dues owed to sugar workers, Kagwe says

    The government will clear all outstanding payments owed to workers in public sugar factories in due course, Agriculture and Livestock Development Cabinet Secretary Mutahi Kagwe has said.

    Speaking during a meeting with the Kenya Union of Sugar Plantation and Allied Workers, the Kenya Sugar Board, and representatives of the four leased sugar factories, Kagwe underscored that settling workers’ arrears remains a priority for the administration.

    “We are not refusing to pay. We are working within fiscal realities, but every shilling due will be honoured,” he said, assuring that both employee rights and welfare will be fully respected.

    He added, “This office remains open and fully committed to ensuring workers and farmers receive what they are owed.”

    The CS noted that the payment programme is already underway, adding that the government has also begun clearing longstanding dues owed to sugarcane farmers. He emphasised the administration’s commitment to reviving the sugar industry, stating that the leasing of key state-owned factories marks a strategic shift toward sustainability, efficiency, and job creation.

    Kagwe revealed that the majority of workers from the factories will be re-absorbed by private operators who have taken over the mills, with others exiting through retirement.

    While highlighting the importance of private sector participation in reviving the sugar industry, the CS issued a set of directives to ensure accountability and smooth operations across the sector. These include immediate commencement of full operations in all leased factories, urgent repairs at the facilities, and strict adherence to investment commitments by the lessees.

    To safeguard farmers and maintain order in the sector, the CS further directed that only the CEO of the Kenya Sugar Board may authorize weighbridge operations. Unauthorized weighbridges, he warned, will not be tolerated, and disruptions to cane zoning and harvesting areas will be firmly addressed.

    Kagwe reaffirmed that the government’s agenda for the sugar belt is anchored in restoring industry confidence, protecting livelihoods, and ensuring fair and transparent operations across the value chain.

  • Privatization Act sets up new entity to oversee disposal of public assets

    Privatization Act sets up new entity to oversee disposal of public assets

    A new government agency formed under the newly enacted Privatization Act 2025 will now be in charge of disposing public assets taking over from the Privatization Commission.

    The new law which repealed the 2005 act provides for the establishment of the Privatization Authority, a new body complete with nine board members including a chairman who will be a presidential appointee.

    According to the act, the authority will have the powers to sue, be sued take, purchase, charge and dispose movable and immovable property and enter into contracts.

    “The new amendment law repeals and re-enacts the regulatory framework for the privatization of public entities with a view to improving their efficiency, profitability, and accountability of public entities,” said Dr. Aurelia Rono, Principal Secretary, State Department for Parliamentary Affairs.

    The Privatization Authority which will now takeover functions of the commission will be charged with executing privatization programme with directions from the cabinet secretary in charge of the National Treasury.

    Additionally, the authority will advise the government on all aspects of privatization of public entities, facilitate the implementation of government policies on privatization, implement specific Privatization Proposals in
    accordance with the Privatization Programme, and collaborate with other organizations within or outside Kenya.

    The law also requires the authority to prepare long-term divestiture sequence plan, monitor and evaluate the implementation of Privatization Programmes.

    The government in its privatization programme is also required ensure there is public participation in plans to sell assets and divest its holding in some entities.

    In recent years, the move by the government to privatize some of its state owned enterprises including sugar companies and the latest being Kenya Pipeline Company has been met with public hostilities.

    “It is worth noting that the new amendment law is also informed by a High Court judgement which declared the existing legal framework (the Privatization Act, 2023) unconstitutional for insufficient public participation; hence the re-enactment of the Act through the new amendment law to comply with the dictates of public participation,” added Dr Rono.

    Those whose view will be sought during the privatization programme include persons with expertise in fields relevant to the entities to be included in the Privatization Programme, organizations representing persons who are likely
    to be affected by the proposed privatization and members of the public.

  • Treasury lists 11 state backed enterprises for privatization

    Treasury lists 11 state backed enterprises for privatization

    The National Treasury and Economic Planning ministry has published a list of 11 State Owned Enterprises it seeks to finalize their privatization by the end of the year.

    According to Treasury, the privatization and restructuring of the firms is expected to help the government raise additional revenue, cut demand for government resources by the firms, improve the country’s regulatory environment, encourage private sector participation in the economy and spur competition.

    The eleven identities for the planned divesture include profit making Kenya Literature Bureau (KLB), Kenyatta International Convention Centre (KICC), Kenya Seed Company Limited, Kenya Pipeline Company (KPC) and New Kenya Co-operative Creameries (N-KCC).

    Treasury says despite five firms out of the eleven being profitable, they are operating in mature sectors and their sale is expected to generate additional revenue for the exchequer.

    “KLB has been making profits over the years, with a turnover of Ksh 2.68 billion, and a net profit of Ksh 85 million and dividends of Ksh 8 million in the FY 2021/2022,” says Treasury in the 2023 Privatisation Programme.

    KLB which is mandated to publish, print and disseminate quality literary, educational, cultural and scientific literature and materials is fully owned by the Government.

    The government’s sale of its 52.88% shareholding in Kenya Seed through the Agricultural Development Corporation (ADC) is expected to generate additional revenue in the firm which serves the East Africa region through its subsidiaries, Simlaw Seeds Kenya, Kibo Seed Tanzania, Simlaw Seeds Uganda and Kenya Seed Rwanda.

    Other firms which are up for sale include loss making National Oil Company of Kenya (NOCK), Numerical Machining Complex, Kenya Vehicle Manufacturers Limited, Rivatex East Africa Limited.

    “NOCK’s financial performance is poor, the Company has been making huge losses and reporting negative working capital over the years & its assets are highly geared with low liquidity,”

    Others are those operating in mature sectors and they include Western Kenya Rice Mills Ltd and Mwea Rice Mills.

    The public have until December 11 to submit their recommendations on the planned sale of the SOEs.