Panic over loss of jobs for EAPCC employees

By Christine Tarayie Musa

Dwindling of business at the East Africa Portland Cement Company (EAPCC) Athi River plant has sent shivers down the spines of hundreds of employees and Kajiado residents who fear losing jobs. A shareholders’ meeting was scheduled to be convened to decide the company’s future.

In the recent past, the ailing giant cement processing plant has been incurring huge losses because of the heavy operation costs, a huge wage bill and large amounts of money owed to suppliers and creditors.

A Sh600 million loan, borrowed from Kenya Commercial Bank (KCB) is long overdue for payment and the company now faces the looming danger of having its assets auctioned.

The company had called an extra ordinary general meeting slated for 27th October, 2019  to deliberate on the proposed sale of part of its unused 12,000 acre chunk of land within Mavoko Sub County to raise money to  settle debts running into billions of shillings.

It has emerged that EAPCC loses Sh600 million annually as penalties on loans they owe Kenya commercial Bank (KCB), which currently stands at Sh5.4 billion.

Board chairman Edwin Kinyua has acknowledged in a 16-page memo that the company has run out of options to raise capital, forcing them to appeal to shareholders to accept selling land that is more than 25 per cent of the company assets.

He points out  that KCB was now set to auction the company leading to its closure if their loan is not repaid because they have given them a fair enough grace period after the government  intervened on EAPCCs behalf  hoping the revival plan would succeed.

The memo also cites another obstacle EAPPC faces from thousands of illegal settlers who invaded the land intended for sale with an appeal for help from government agencies to evict them. The company lacks capacity, machinery and financial muscle to undertake the eviction.

In 2017, EAPCC laid off its entire workforce in what it said was a new restructuring programme that highlighted the worsening liquidity crisis at the country’s third-largest cement maker.

All 1,500 employees were asked to reapply, as the company sought to get a lean workforce to balance its running cost and raise the levels of productivity thorugh a 40 per cent pay cut.

According to the company’s acting Managing Director Stephen Nthei, the company still requires Sh45 billion to pay its bills to remain afloat in the market and make profit.

Records show that majority of the employees hail from Kajiado County and over 300 young people are now idle at home after they were declared redundant.

A total of 620 employees were sacked in March this year as EAPCC sought to reduce the Sh200 million wage bill, but that did not stop the bleeding despite the number of staff reducing from 1,500 to about 800.

“We are targeting to only retain only 600 employees once the company is fully revived because some have also left through other causes like retirement and attrition,” explained Nthei.

Most employees now fear they will be sacked despite the assurance from the EAPCC management that the current workers will be given first priority to reapply.

With production of cement at the factory declining by up to 50 per cent to 20,000 tonnes monthly, casual labourers at  Kibini, Ilbissil and Nkurruka quarries which are the sole suppliers of pozollana, limestone and clinker have already been hard hit economically as fewer lorries trickle into the mines.

The fate of the troubled company now remains with the much awaited shareholders decision and the majority vote to approve selling of the land.

But the more critical task of kicking out the illegal settlers could prove more challenging even if selling of the land is approved by shareholders.


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