KENYA – Kenya’s largest and fastest growing supermarket chain, Naivas Supermarket is set to open three more outlets before the year ends, cementing its market leadership position.
The first outlet, according to reports by Business Daily, will be opened at Oasis Mall in Malindi in a store previously occupied by fallen Nakumatt.
This will be followed by two branches in Embakasi off Airport North Road and Greenspan Mall in Donholm Nairobi, taking space vacated by the cash-strapped Tuskys supermarket.
Naivas has stepped up its expansion drive after receiving backing from international investors i.e., International Finance Corporation (IFC), Amethis, MCB Equity Fund and DEG fund for a 30 percent stake.
“We are elated that our store openings have been greatly enhanced through the support of our stakeholders and investors who have strengthened and improved corporate governance, increased accountability and professionalism within the business.
“We are excited that this double store opening comes just in time for the kick-off of the Kenyan festive period traditionally marked by Jamhuri Day,” Naivas chief commercial officer Willy Kimani said.
The new stores are expected to raise the retailer’s branch network to 80, up from 26 in 2013 in a growth that reflects the health of Naivas—which over the period has grown to be Kenya’s top retailer from position four.
The unappealing side of Kenya’s retail market
Its rise emerges in a competitive market that has seen two major supermarket chains collapse in recent years including Nakumatt, while Carrefour franchisee Majid al Futtaim has entered the market and grown into Kenya’s second-biggest retailer in just five years.
South African retail giant Massmart that operates the Game Stores has announced its plan to sell its three stores in Kenya, joining Shoprite Holdings that quit Kenya in less than two years after entering it.
Meanwhile, Tuskys Supermarket is clutching at a straw as it sits on pins and needles due to debt running into billions, threatening its expulsion of tenancy, auctioning and possible business collapse.
The cash-strapped retailer has been given up to 25th of December to reveal the identity of the mystery offshore investor seeking to buy it out or have it wound up.
The Kenyan High Court has given the supermarket chain owner 30 days from November 26 to reveal details of a restructuring plan that includes tapping a strategic investor for Ksh2.1 billion (US$18.6m) and sale of Tuskys assets worth Ksh911 million (US$8m).
Failure to make disclosures would likely trigger hearing of a liquidation suit, which could see the retailer wound up to allow creditors recoup their debt after an unsuccessful rescue attempt.
Tuskys has hinged its recovery on the asset sale, the Ksh2.1 billion (US$18.6m) and restructuring of its debts to ensure staggered payment of creditors.