Ever revolving musical chairs at KP spin again
Troubled utility power provider Kenya Power has appointed an acting managing director once again after Benard Ngugi resigned from the position even as speculation is rife that Bretton Woods institutions are pushing for an expatriate to occupy the position.
The board of directors yesterday appointed Rosemary Oduor to occupy the corner office with effect from August 3, 2021 at the loss making Nairobi Securities Exchange (NSE) registered firm.
“On behalf of the Board of Directors, I take this opportunity to thank Mr. Bernard Ngugi for his dedicated service to the Company, and wish him all the best in his future endeavours,” said Vivienne Yeda, the board chair.
Ngugi who has served the firm for 32 year has been at the helm for nearly three years having replaced then acting MD and chief executive Jared Othieno in October 2019.
Ngugi who was previously the long serving company’s general manager, supplies chain took over the company when it had made losses for the second year in a row.
In June 2019, the firm announced a 25 per cent drop in net earnings, which is equivalent to Sh1.43 billion.
While appointing Ngugi, the then board chair Mahboub Maalim said the company considered his expertise in financial and revenue accounting, internal audit and supply chain management, areas that were of critical concern to the company and where Ngugi excelled.
“We believe that Mr. Ngugi will see the company through an important stage of its development and growth as we work to diligently implement all our plans to strengthen the company and the commercial aspects of the business,” said Maalim.
Oduor’s appointment to the corner office is the fourth by insiders in recent years, for a company struggling to find its financial footing despite being a monopoly.
Her appointment comes amidst a spotlight from the International Monetary Fund (IMF), which is pushing the government to limit support to struggling State-owned enterprises (SOEs) as part of new financing conditions.
The firm is said to be in the market for a technical adviser to implement a restructuring plan, which includes reduction of debts, electricity theft and strategy for renegotiating bulk power purchases from firms like KenGen.
“Is IMF pushing for an expatriate CEO at Kenya Power?” asked Financial analyst, Mihr Thakar on twitter.
“Expatriates are not necessarily better managers but the wording would be along the lines of finding someone who has extensive experience running larger utilities and turning around loss-making ones,” he said.
The office has also been occupied by Ken Tarus and Ben Chumo and Othieno, who despite their excellent academic qualifications, have been unable to turn around the fortunes of the company.
Oduor has her work cut out, as she is inheriting a debt-ridden firm that has been in negotiation with the World Bank to consolidate its short-term Sh102.6 billion commercial debts into a 25-year repayment programme.
As the details of the resignation emerged, Activist Okiya Omtatah was in court yesterday to contest a scheme to rig the KPLC Tender for Insurance Brokers in favour of large corporate players by imposing eligibility requirements that lock out many local players.