Karume: Charcoal seller who rose to champagne life

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By PAUL WAFULA pwafula@ke.nationmedia.com
Posted  Friday, February 24  2012 at  22:30

Nothing speaks more of the entrepreneurship fire that burned in the man who referred to himself as a former charcoal burner than the size of the business empire he has left behind.

James Njenga Karume, who died on Friday, is no doubt one of Kenya’s wealthiest businessmen.

Karume, who began his business life a humble man selling exercise books, timber, charcoal and distributing beer, has accumulated wealth that runs into tens of billions of shillings in land, real estate, companies, agriculture, hotels, transport and distribution.

He owns more than 500 acres of land in Kiambu valued at over Sh3 billion.

He is also the title holder of land spanning 9,000 acres around Lake Elmenteita known as the Elementeita Badlands or the Otutu Forest. 

It is said he bought it from a colonial master Arthur Cole in 1980. His other commercial investments include the United Touring Company Group, Nairobi’s Jacaranda Hotel, the Indian Ocean Beach Club in Mombasa and the Highlands Hotel.

He also owns Lake Elementaita Hotel and Kentmere Club and the twelve-storey Cianda House on Koinange Street, Nairobi.

In the agricultural sector, the former Kiambaa MP owns Cianda Flowers, and Kacheroba Ltd companies, as well Highland, Kivurini, Kambala and Katikati farms — most of which were acquired during Kenyatta regime.

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In 2009, the self-made tycoon had shares in Kenya Wines Agencies Ltd after Mzee Kenyatta allowed distributors to buy a five per cent stake in the State-owned firm.

His ambition and shrewdness in business is captured in his autobiography, Beyond Expectations: From Charcoal to Gold, where he tells his story of an entrepreneur with typical false starts. 

He told his biographer, Mutu wa Getho, that he never feared trying new things. He initially made his living by hewing wood in Elburgon forests near Nakuru.

He went on to start what became the largest wholesale and retail chain in Kiambu County.

When Kiambu became too small for him, the entrepreneur decided to venture into Nairobi, opening a wholesale on the then Grogan Road (now Kirinyaga Road), long before independence. He also opened a bar and a restaurant in Nairobi in 1958.

Later he operated a transport company called Nararashi Distributors, where he owned dozens of trucks to transport beer, premises and beer depots in Nairobi.

Nararashi distributed the products of the Kenya Breweries Limited before investing millions of shillings in Castle Brewing— a Kenyan subsidiary of South African Breweries in the 90’s— and offered to double up as a distributor. He was appointed a director of the firm.

But KBL was afraid of the competition and cancelled the distribution contract with Karume.

He sued the bear manufacturer and although the High Court first ordered KBL to pay Sh231 million in damages, the decision was overturned upon appeal. Karume was ordered to pay KBL the costs of suit.

He continued to distribute Castle Beer for a while until SAB left Kenya in 2001, finally ending his transport business.

“On my part, I felt that I had never breached any part of the contract and that I was just a businessman who had taken advantage of an opportunity,” he notes.

Accused of fraud

The man who was outspoken against the need to fire corrupt officers from government, however, had his fair share of accusations.

One of his dark spots was when he was accused by the shareholders of Gitamaiyu Trading Company Ltd of allegedly defrauding them of more than 500 acres in Kiambu. 

He also featured during allegation that he had received Sh11 million from a businessman who had won a tender to supply tents to the Department of Defence at a time he headed the defence ministry.
But it is the recent spat where a man named Edwin Thuo went to court seeking to establish that he is Mr Karume’s son that threatened to disrupt the man’s last days.