Poor management, mounting debts killing Taraba Highland Tea Company as Kenyan investors decline partnership offer

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By Uhuru Samuel, Jalingo

Bureaucratic bottlenecks coupled with mounting debt crisis are threatening the very survival of Mambilla Beverages Limited, the only existing commercial venture wholly owned by the Taraba state government.

Mambilla Beverages Limited, producers of Highland Tea, was now in the eye of a major storm, following intense political interference in its operations by indigenes of Mambilla Plateau, even as the state government has coerced its management to guarantee more than N23 billion in loans for some projects.

Unfortunately, the company whose total assets peaked at over N13 billion a few years ago, was currently being valued at around N3 billion.

Although this claim has not been independently verified, insiders said most of its equipment and machineries were now obsolete, tea plantations shrinking, even though it acquired a new plucking machine a few years ago.

Trouble started for the massive tea estate, about three years back, when the administration of former Governor Darius Dickson Ishaku, proposed to privatise the company by selling majority shares to private entities, while the government retained minority shareholding.

The government had argued then that, if private capital and expertise were injected into the firm, it would become more viable and sustainable as it would be positioned for profit making for both government and investors alike.

But indigenes of Mambilla Plateau, particularly the political elites, mounted sustained resistance against the sale, claiming the tea estate formed part of their own share of the proverbial “National Cake” and therefore, must not be sold.

Among the top notchers who opposed the privatisation idea was the present Secretary to the Government of the State, (SGS), Barr Gebon Kataps, his elder brother, the late labour leader, Comrade Jonah Kataps, Hon Abel Diah, member representing Mbamga State Constituency,and a host of other community leaders.

However, in what observers described as a twist of fate, Barr Kataps was appointed the SGS by Kefas, immediately he took over the baton from Ishaku and by that position, he automatically became board chairman of the company, in consonance with a precedence set by previous administrations.

Under this development, the stage was thus set for gradual and systematic control of not only the daily operations of the company, but also its finances by the same clique who insisted on maintaining the status quo, which made Highland tea a cash cow for imbedded interests.

It may be recalled that, the administration of late Gov Danbaba Suntai, had bought over the company on auction in the sum of N380 million, in the course of asset sharing between Adamawa and Taraba states, as it was wholly owned by the defunct Gongola state, from where both states emerged in 1991.

Danbaba had used funds from the state and local government joint account for the purchase, which automatically qualified all the 16 Local Government Councils in the state as equal shareholders, including Sardauna Local Government, where the tea estate and factory were situated.

Prior to this time, specifically during the administration of former Governor Ishaku, Mambilla Beverages Limited, was declaring a dividend of N50 million yearly for its shareholders and this ran for five years, until now.

The hope that this trend would not only be sustained, but improved upon was, however, dashed with the current SGS, an indigene, now running affairs as board chairman, as all the gains recorded in the recent past were being eroded.

Things started going south for the tea producer, when the Kefas administration committed its assets for the procurement of a N5 billion loan for the conduct of a feasibility study on the viability of rice production in Taraba state.

While the company was vying for some breathing space, the government again caused it to guarantee another 10 million Euros loan to purchase farm implements, including tractors and tillers from the Czech Republic for farmers in the state.

To consolidate the Mambilla agenda, the SGS two years ago, orchestrated the deployment of Dr Abubakar Hamidu Kara, a lecturer with the Taraba State University, on secondment to the company as Head of Human Resources, to understudy the immediate past Managing Director with a view to taking over as Chief Executive Officer at the end of the former’s tenure.

These planned maneuvers were already manifesting, as Dr Kara has since assumed the position of Acting Managing Director, thus giving the Mbamga arm of the “Mambilla Mafia” total control of the company, even to the detriment of the host community.

A source within the tea estate, who spoke to this newspaper in confidence for fear of victimisation, said about 85 percent of the total workforce in the employment of Highland Tea estate were from a particular ethnic group on the plateau and every other staff, including members of the host community of Kakara were being treated as second class citizens.

According to the source, industrial harmony that was always under constant threats in the company, appeared to be a thing of the past, because those external influences that were behind disruptions of operations in the estate prior to this time, were now in charge.

Apex News Exclusive learnt that the financial situation in the company was so severe, that management now resorted to collecting monies in advance from customers, before they produce and supply, unlike in the recent past where transactions were strickly on cash and carry basis.

It was in anticipation of this likely scenario, that the Obadiah Ando/Kifasi committee on streamlining operations of Ministries, Departments and Agencies, (MDAs), recommended that the practice of allowing a sitting SGS an automatic chairman of Mambilla Beverages Limited Board of Directors should be discontinued

It further went on to recommend that a technocrat or an established business person outside of government circles should instead into that position in other shield it from political interference and drive optimal performance, but Gov Kefas was yet to act on the recommendation.

Meanwhile, in a desperate move to rescue the company, the government recently sent a delegation composed of the Mambilla political class to Kenya to invite Kipchimchim Group, one of the country’s leading tea producers to come and take over the management of the estate.

Kipchimchim Group, owned by Mzee Ngetich, a Billionaire, popularly known as Chepsetyon, is an iconic industrialist and serial entrepreneur in that country, who controlled six tea estates, beside divergent portfolios in Agriculture, Manufacturing, Wholesale and Distribution, Logistics, Warehousing, Retail, Supermarket Chain, Mining and Construction.

Sources close to the engagement between the two, however, told our reporter that the Kenyans were non committed to any deal when they learnt that Highland Tea was a state owned enterprise and the absence of a clear working document explaining the nature of the relationship the government envisaged with them also compounded the proposal.

Even though, they were convinced to send a delegation to the just concluded Taraba Investment Summit and even went on a site seeing at the Kakara tea estate at the expense of the state government, no deal was extracted from them.

When contacted, the Acting Managing Director, Dr Abubakar Hamidu Kara, told our correspondent that the company was still in production, but he however, said battling with some obsolete machines that had been in the factory for over 40 years

He said the present government has been able to source for scarce spare parts from China, India and Argentina. But when pressed further on the financial status of the company, including the loans, he gently referred us to the office of the SGS.

All efforts to reach Barr Kataps in the last two weeks were unsuccessful, as several calls and messages to his phone remained unattended to and when he finally responded to the final one, he promised to get back, but never did as at the time of going to press.

Meanwhile, Apex News Exclusive investigation on the allegations of diversion of funds amounting to billions of Naira by the management of the company, including secret purchase of bullet proof vehicle for a top government official is in progress.