Saturday, September 23, 2023

Court orders liquidation of Tuskys Supermarket over Sh. 20 billion debts

It is officially the end of an era for Tuskys Supermarket. The High Court in Nairobi has ordered for the liquidation of assets belonging to Tuskys, bringing an end to a 30 year journey of retail business.

In a ruling that was delivered on Wednesday, High Court judge, Justice David Mayanja declared that there was no hope whatsoever that Tuskys could ever be revived.

The supermarket went down with debts of over Sh. 20 billion that it owed suppliers. It has assets that are estimated to be worth around Sh. 6 billion.

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This implies that even after all its assets are sold off, the funds raised will not be enough to settle all the debts owed to suppliers.

Tuskys Supermarket revealed its gloomy financials in court in 2021.The retailer disclosed in court papers that its assets coulf only cover payments of Sh. 6.67 billion of the debts or 34 per cent of the dues owed to unsecured creditors.

This indicated that Tuskys owed the unsecured creditors a total of Sh. 19.6 billion, which was nearly ten times the Sh. 2.1 billion the retailer seeking from a strategic investor for its revival.

Tuskys had hinged its recovery on the assets sale worth Sh. 911 million, the Sh. 2.1 billion from strategic and restructuring of its debts to ensure staggered payment of the creditors.

Tuskys was until a couple of years ago Kenya’s top retailer. It had 53 stores which fell to less than seven outlets operating amid stock-outs by mid 2021.

At its peak, the retailer was an acquisition target for global giants seeking a foothold in East Africa such as Walmart.

However, poor management, rapid expansion and a vicious fights among family members that own Tuskys hurt the retailer, opening the door for rivals such as Naivas, Carrefour and  Quick Mart to gain market traction.

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