Farmers and former employees of Transmara Sugar Company, a Kenyan sugar producer linked to the wealthy Mauritian Lagesse family, have taken legal action, claiming $7.84 million in damages for alleged breaches of contract and unfair retrenchment practices.
According to the latest annual report from IBL Group, a multinational conglomerate led by the Lagesse family, which holds an ownership interest in Transmara Sugar Company, there are several ongoing legal disputes, one of which pertains to accusations of breach of contracts with outgrowers and unfair termination of employment.
The total exposure for these legal cases amounts to MUR 343 million ($7.84 million), the conglomerate stated in its latest report.
In the year ending June 2022, Transmara Sugar recorded a provision of MUR 7.8 million ($179,600) for potential losses in cases that management deemed as likely. The company’s management does not anticipate any additional payouts, and as a result, no further provision was made.
The recent legal disputes faced by Transmara Sugar come nearly six months after Alteo Limited, a leading sugar producer controlled by the wealthy Mauritian Lagesse family, bought an additional stake in the Kenyan sugar producer in a deal worth $8.2 million.
According to a memorandum released by Alteo, the additional stake was acquired with cash on hand and a $5.05-million debt contracted by Sucriere des Mascareignes Limited, as the group continues to diversify its robust portfolio of sugar firms, in line with its strategic expansion plan.
Lagesse Family-owned entities expand operations through share acquisitions
Entities owned by the Lagesse family have recently expanded their activities through strategic acquisitions of shares in high-performing consumer goods and retail companies.
In June, IBL Group, in collaboration with French financier Proparco and German sovereign wealth fund DEG, acquired a significant stake in Kenya’s leading grocery chain, Naivas International, for Ksh3.7 billion ($31.5 million).
This transaction increased Proparco, IBL Group, and DEG’s combined share in Naivas to 40 percent at a greater per-share value than the Ksh6 billion ($51 million) paid by the International Finance Corporation, Amethis, and DEG in April 2020 to acquire a 30-percent stake in the company.
