Webuye Residents Give Diverged Views on the Opening of Pan Paper

By Soko Directory Team / May 1, 2016



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Residents of Webuye have expressed their views following the announcement by President Uhuru Kenyatta that Webuye Pan Paper will be revived in four months’ time. Some of them are happy while some are sceptical about the announcement.

Pan Paper broke down in the year 2009 and any attempts to bring it back to life have often been futile. The government tried to resurrect it one year after the collapse but the factory only managed to run for two weeks before breaking down again. Ever since that attempt, what has been going on are just unending promises from the politicians.

Some residents say that the revival of Pan Paper will bring back life to Webuye town in general. The town which entirely relied on the factory for livelihood went into a coma with the coming down of the factory. It is estimated that close to 1500 people lost their jobs following the grounding of the factory.

Others have also expressed hope of the factory sustaining itself after resuming operation because it will be run by a private developer. Pan Paper, which in 2012 was valued at 18 billion shillings, was sold at 900 million shillings to the Rai group which is planning to inject in six billion shillings to set the machines back to their feet. Many people have, however raised eyebrows as to how a company that was valued at 18 billion shillings four years ago could depreciate and go only for 900 million shillings.

Tomkim Baraza, a teacher at Alliance School and a political analyst says that the move is good and set to benefit Bungoma County as a whole. He however said that the paper factory was not very beneficial given the fact that Bungoma County lacked the much needed raw materials for the same. He was of the opinion that another alternative factory that suits the local products in the County would have been more beneficial. He said the best that the factory would do maybe is to create jobs but nothing much as far as the development of the County is concerned.

Bungoma County

It has emerged that Bungoma County was not among the entities that had presented their interests in taking over Pan Paper. This was confirmed by PWC, a body whose Pan Paper was placed under so as to cater for the interests of the long-time lenders. This lays to rest speculations that had been flying around the social media platforms and on political forums that Bungoma County was planning to take over Pan Paper.

The National Government

The National Government has no stake in the Pan Paper at the moment but the five long lenders. The government, which was a shareholder in the factory, lost its stake in Pan Paper when the factory went under receivership in 2009. The factory has now been sold to Rai group at a cost of 900 billion, not enough to bill off the long-term lenders but with the hope of bring it back to its feet.

The Rai company

This is the company that has taken over Pan Paper. The company has moved to assure the locals that the social amenities that were being undertaken by the factory before its natural death like schools will fully be revived for the beneficial of the community. The investor also assured the public that the factory will strictly deal with paper productions and nothing more. The company estimates to begin with the production of 25000 tonnes annually per single line that is set to be up four months from today.


Article by Juma Fred.



About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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