Cash-strapped Savannah Cement Company has temporarily "shut down" its Athi River giant plant that had been dormant for one month.
The financial problems dogging the private cement processor seem to have escalated a year after it launched a new Sh5 billion grinding plant and fired 21 senior employees.
Savannah was also hit by ownership wrangles and protracted court battles in recent years. In May, the Court of Appeal quashed the appointment of new directors.
A December 22 memo seen by the Nation instructs all employees to proceed on a 10-day break to pave the way for “plant maintenance”.
“We would like to take advantage of the festive season to undertake plant maintenance works to ensure that our plant is in excellent condition in readiness for uninterrupted milling when the new year starts,” said the notice from Managing Director Samson Shivina.
“In this regard, we shall break for Christmas and New Year commencing tomorrow 23rd December 2021 at 1pm and reopen on Monday 3rd January 2022. For those whose services shall be required, your supervisors will liaise with you to ensure there is a seamless operation."
But an insider has intimated to the Nation that cement production at the factory had plummeted significantly in the past six months and Savannah’s market share had shrunk. Lower-cadre employees fear losing their jobs.
"Milling was suspended for the last one month. It’s evident the company is undergoing a financial crisis. Salaries have not been (paid on time). We fear some employees might be laid off," said an employee, who did not want to be named for fear of reprisals.
After the grinding plant opened, 21 senior employees were sacked and the managing director at the time, Ronald Ndegwa, left the company in a huff.
Savannah is said to be adopting new technology and reducing its workers, who were seen as hindering the expansion plan.
The new plant was expected to grind 1.2 million tonnes of material per year and was meant to double the firm’s production capacity, but insiders said the returns were minimal.
The Sh8.5 billion Savannah began cement production in 2012 as the sixth processor based in Athi River with an annual production capacity of 1.5 million tonnes.
