A fresh feud has rocked retail giant Naivas family. This is after the one of the brothers, Newton Kagiri Mukuha, went to court seeking to block any stake sales in the retailer. Kagiri is also seeking the ouster of his brother David Kimani as chief executive officer of Naivas.
He also wants a seat on the board of the retailer, a 20 percent stake and additional shares from the 20 percent stake held by his dad, the late Peter Mukuha Kago. Apparently, he claims that he is entitled to a 20 percent stake worth Sh. 4 billion from his seed capital that established Naivas and the inheritance of his father’s stake.
According to a report that appeared in a local daily on Monday, Kagiri has also petitioned the court to freeze further share sales in Naivas and for a deposit of the Sh. 6 billion, which a consortium of investors paid for a 30 percent stake in the retailer in an interest-earning joint account.
The new fight comes slightly a year after Naivas successfully sold a 30 per cent stake at Sh. 6 billion. The stake was sold to among others the World Bank’s International Finance Corporation. Others who took part in the deal include private equity firms Amethis and MCB Equity Fund and German sovereign wealth fund DEG. This sale took Naivas’ valuation to Sh. 20 billion.
At Sh.20 billion, Naivas’ valuation beats the market value of all but one company listed on the Commercial and Services segment of the Nairobi Securities Exchange, including Uchumi Supermarkets (Sh. 128 million) and Scangroup (Sh. 4.8 billion).
The fight for control of Naivas first went public in November 2012 when Kagiri went to court, seeking orders to stop the sale of the supermarket to South Africa’s Massmart. This deal collapsed. In the family feuds, Kagiri’s brothers have previously termed him a stranger to the retail chain.
The court has previously stated that Kagiri has no claim to the retail chain. Apparently,
Kagiri had sparked a fight for the family assets in the 90s, prompting for an estate division on October 31, 1999. At the time, the assets were trading under Rongai Self-Service Store which had three supermarkets in Elburgon, Rongai and Naivasha.
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“Kagiri was offered the Rongai store and a house. His younger brother, Simon Gachwe and sister, Grace Wambui, were given a house and the Elburgon store while David Kimani and his sister, Linet Wairimu, took over the Naivasha business. Kimani and Mr Gachwe later teamed up to run the Naivasha business and ultimately grew the supermarket into the retail giant that is Naivas. The two brothers later offered their two sisters a 15 percent stake each and a 20 percent ownership to their father, Mukuha. Kimani and Mr Gachwe have a 25 percent stake each in Naivas. This was ownership ahead of the Sh. 6 billion deal,” a report in the dailies said.
This saw Justice Anyara Emukule in 2014 rule that Kagiri had no claim and could only contest for the 20 per cent stake that was allocated to his father.
