Friday, March 29, 2024

Tuskys under probe over Sh. 1.2bn debt as collapse fears rise

Tuskys Debts: Troubled retailer Tuskys Supermarket is under probe over a Sh. 1.2 billion debt. Reports say that the Competition Authority of Kenya (CAK) has launched an investigation into the retailer’s bank accounts.

This is the latest indication that Tuskys is on the verge of collapse and may go down with billions of money owed to suppliers unless a rescue strategy is laid out fast.

Is Tuskys collapsing? Suppliers raise red flag over rising debts

According to a report that appeared in a local daily, Tuskys has been “ordered to furnish the regulator with its monthly bank statements for the past one year for all bank accounts relating to its retail business by Friday this week.”

The report that appeared in the Business Daily said that the CAK started looking into Tuskys operations in April after reports emerged that it was not paying suppliers on time as provided for in their respective contracts.

“The watchdog on Monday ordered Tuskys to settle the Sh. 1.29 billion by between July 1 and July 16. Tuskys’ executives and the retail chain risk a jail term of five years or a fine of up to Sh. 10 million or both if they fail to settle the debt or furnish CAK with bank statements, audited accounts, list of suppliers and their contracts. The retailer on May 15, told the regulator that it owed suppliers a total of Sh. 884.3 million. It subsequently wrote to CAK on June 12, revising down the outstanding sums without proof of payments and concurrency by suppliers. However, the regulator, established through independent investigations that the retailer had failed to disclose another Sh. 400.9 million owed to suppliers,” the report said.

Away from the piling supplier debts, reports say that sections of the Tuskys branches have been reporting stock-outs in the same fashion that befell Nakumatt Supermarket.

“Is it just me or is Tuskys showing signs of trouble? Empty shelves, unavailability of many common brands and general feel of resignation. Reminds me of the twilight days of Nakumatt and Uchumi,” Kaka Karim reported on Facebook.

“Tuskys has been having empty shelves for a while now. Tuskys Buruburu,” said Jules Gathiru.

“In Kitale they recently closed a branch which they took from Nakumatt(had ample parking) and used corona as an excuse. But I noted that they didn’t transfer some of the goods to the CBD branch, which had more than enough space to swallow all merchandise from the closed branch. When asked why, they say all goods were transferred to Nairobi. But it’s curious that a supermarket doesn’t have pillows, mattresses, clothing etc and still calls itself a supermarket,” Stephen Arap Chumo commented. Tuskys Debts.Tuskys Debts

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