A farmer plucks ripe coffee berries from his farm: CMS also runs a a
3,326-acre coffee farm owned by Tatu City owners, Rendeavour Group. FILE
PHOTO | BENSON MOMANYI | NMG
The board of listed coffee grower Eaagads Limited
has decided to sub-contract operations on its 203-hectare farm to a
regional management company in a move that could result in lower
operational costs.
In a communication sent out to
shareholders, the 70-year old Ruiru-based firm said it intended to hand
over its business to the Coffee Management Services Limited(CMS), a firm associated with global coffee roaster Dormans with a presence in Kenya, Rwanda, Uganda and Tanzania.
The
NSE-listed company, which is currently trading at the bourse at Sh22
per share, said it is awaiting approval from the Capital Markets
Authority before finalising the deal.
Fate of employees
There
was no word on the fate of the coffee grower’s 216 employees given that
CMS is a fully-fledged enterprise with staff handling activities
including farm management, milling, coffee marketing as well as a direct
linkage of farmers to local and foreign coffee roasters.
Kofinaf
holds a 61.74 per cent shareholding in loss-making Eaagads, which last
year recorded a Sh7.7 million half year net loss for the year ending
September 30, largely attributed to an unrealised Sh30.2 million value
loss on revaluation of its assets.
“The company's coffee bushes are in good shape and
management expects the company's operations to remain profitable for the
remainder of the financial year,” Eaagads said in a statement Tuesday.
CMS also runs a 3,326-acre coffee farm owned by Tatu City owners, Rendeavour Group.
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