ICT Cabinet Secretary Eliud Owalo has appointed Communication Economic Expert Paul Macharia as the acting Managing Director (MD) for Kenya Broadcasting Corporation (KBC) for six months.
He replaces Samuel Maina, who proceeds on suspension and will face disciplinary action for committing the government to pay $5 billion in LCIA Arbitration with Channel 2 Group without seeking concurrence of the Ministry, The National Treasury, and the Attorney General.
According to Owalo’s letter dated December 19, addressed to KBC Board Chairman Eng. Benjamin Maingi has been directed to expedite the recruitment process of a substantive MD.
“The appointment of Samuel Maina as acting MD is terminated with immediate effect and he should proceed on suspension and disciplinary action instituted against him by the board,” Owalo said.
The conflict began in 2009 when KBC ended a joint venture with Channel 2 Group's owner, tycoon Ajay Sheth, based in Dubai.
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As per the court records, KBC and Channel 2 collaborated in 2006, with the State broadcaster providing technical equipment and the latter giving staff, programming content, and resources to the new digital station.
Channel 2 and Mr. Sheth counter that KBC abruptly ended the agreement in 2009, costing the businessman billions in lost revenue and costs associated with the joint venture.
London has been the arbitration venue for this dispute.
According to the latest data from the National Treasury, KBC reported Kes 1 billion in internally generated funds in the 2020-21 financial year, largely from State transfers, and Kes 305 million in losses.
