Tuskys Supermarket on verge of Sh6bn assets loss
A closed Tuskys outlet. High Court has ordered the liquidation of the Tuskys Supermarket chain. The chain's Sh6 billion asset base is just 30 percent of its debts meaning creditors will have to take a hit on their dues.
Tuskys Supermarket is now on the verge of losing assets valued at about Sh6 billion following the appointment of a liquidator by the High Court.
This comes barely three months after the court ordered the liquidation of Tusker Mattresses Limited, as the retailer is officially known, in a suit filed by several creditors owed Sh19.7 billion by the struggling retailer.
The move will be the last nail in the coffin of one of Kenya’s largest supermarkets, which has been in business for the past three decades.
In June, High Court Justice David Majanja ruled that there was no hope for the rescue of the once successful family business after failing to prove the existence of a working plan to get back to its feet and pay its creditors since 2020 when Hotpoint Appliances and other businesses, filed for the retailer’s liquidation.
Estimated at about Sh6 billion, Tuskys assets are, however, far short of the debts it owes former suppliers and other creditors.
The appointment of a liquidator means the supermarket will lose its assets in an auction. Among known assets belonging to the supermarket are its headquarters on Mombasa Road, Nairobi, and a five-storey building within Nairobi’s central business district (CBD), which has been hosting one of the supermarket’s last remnants of its outlets, from 63 stores at the peak of its operations.
A notice of appointment of Owen Koimburi Njenga as interim liquidator by the High Court in Nairobi was published in the Kenya Gazette and local dailies last Friday.
Mr Koimburi was appointed on August 18 and the liquidation order was signed on August 31.
The retailer has been under financial duress since creditors started going after it in 2020.
Last year, Equity Bank went after the five-storey CBD-based building, advertising to auction it through Antique Auctioneers in local dailies, over a Sh650 million loan the lender advanced it in 2014. The retailer failed to convince the court to rule against Equity’s pursuit of the property.
“More fundamentally though is the undisputed fact that the bank is a secured creditor. As a secured creditor, the bank is entitled to exercise its statutory power of sale without recourse to the court exercising insolvency jurisdiction,” Justice Majanja ruled.
Early this year, the retailer closed yet another outlet in the CBD on Kenyatta Avenue, which underscored the problems it has been facing. It was left with the Tom Mboya Street-based outlet as the only one remaining within the Nairobi CBD.
It said the branch was closed “due to unavoidable circumstances” and asked shoppers to “kindly support our Tom Mboya St Branch”.
