Kingi sends EA Portland board on compulsory leave pending probe

The East African Portland Cement managing director and board of directors were Friday sent on compulsory leave by the government pending investigations into the company affairs.

But in a quick rejoinder the chairman of the board declined the orders terming them as gross interference in the affairs of the company.

Mr Kephar Tande, is the managing director while Mark Ole Karbolo is the chairman of the board.

In a statement sent to media houses, the acting Minister for Industrialization, Amason Kingi said the move was warranted by the serious allegations of malpractices that have led to huge losses and continued poor performance.

“The government has decided to carry out forensic investigations into the matter. Consequently, the board of directors and the managing director have been suspended with immediate effect until the allegations are fully investigated,” the statement signed by Mr Kingi read in part.

In his rejoinder, sent a few hours after Mr Kingi’s statement, Mr Karbolo says Portland Cement is no longer a parastatal and as such the minister has no authority to order the board out of office.

“Consequently the board and the directors of Eapcc will not comply with the minister order,” Mr Karbolo added.

Last week, National Social Security Fund reduced its stake in the company from 27 per cent to 23 per cent effectively reducing the government shareholding in Eapcc from 52 per cent to 48 per cent.

The 3.6 million shares worth Sh200 million were transferred to NSSF workers retirement benefit scheme.

The now suspended management had celebrated the reduction, which had effectively taken out Eapcc from a parastatal, saying it would increase efficiency and reduce political interference.

Remain in office

“This is good news to Portland investors because the requirements of State Corporation were not conducive to our kind of business,” Mr Karbolo told reporters last week.

“We had to tender in a certain way and we had to consult the ministry and other government agencies, which headed up delaying decision making process.”

Eapcc board says it will now seek legal interpretation of the minister’s order but “will remain in the office until otherwise lawfully directed.”

In the Sunday Nation, read how the Eapcc board paid extra Sh69 million to import four clinker equipment last year against the advice of the company’s tender committee.