Tuskys to lose largest asset yet through public auction over US$5.7m debt

KENYA – Ailing retailer Tuskys is facing a new auction at one of its remnant branches inside Nairobi’s Central Business District (CBD), over a Ksh650 million (US$5.7m) Equity Bank debt.

The branch, Tuskys Imara, is part of a five-storey commercial property registered in the name of Tusker Mattresses Limited.

It will be the first real estate asset lost by the retailer through a public auction, which has so far only lost merchandise to auctioneers for rent default.

The property which comprises three floors of a shopping mall will be sold when the auctioneer’s hammer falls on March 2.

Insiders at the Antique Auctions, which is driving the sale of the city centre property, linked the auction to an alleged Sh650 million loan that the supermarket operator owes Equity Bank, reports Business Daily.

“We are selling the building where Tuskys currently operates along Tom Mboya Street in Nairobi on public auction and the asking price is Sh650 million (US$5.7m).

“They took a bank loan from Equity Bank that dates back to 2014 and they defaulted on payment,” a representative of Antique Auctions said.

ADVERT

As part of the requirements for the sale, a deposit of 25 percent of the total amount must be paid immediately after the acceptance of the bid in cash or a banker’s cheque and balance paid in 90 days to Equity Bank.

Sale of the property will likely see the Tuskys Imara supermarket closed unless the new owner chooses to retain the retailer as a tenant.

Tuskys Imara is one of the few remaining outlets for the former retail giant which has in recent months struggled to stay afloat under the weight of creditors’ pressure including enraged landlords.

ADVERT

As of December 2021, the retailer had only seven other operational branches including two in the CBD, Langata road (T-Mall), Tuskys Thigiri, Ongata Rongai, BururuBuru (Eastlands) and Kiserian (Ol-Talet).

At its height in early 2020, Tuskys was Kenya’s largest retailer serving over 10 million customers through nearly 65 branches in Kenya and Uganda and an e-commerce platform.

The continuity of the beleaguered retailer presently hangs in the hands of its creditors which it owes in billions in debt.

Taking over the spaces of the collapsing retailer, Naivas Supermarket, is set to open two branches at Nairobi’s Greenspan Mall and Imara Shopping Mall.

The establishment of the outlet at Greenspan Mall, which is owned by Nairobi Securities Exchange -listed property investor ILAM Fahari I-Reit, had been delayed by a court case filed by former tenant Tuskys.

The two branches come as Naivas races to defend its market leadership against its closest rivals Quickmart and Carrefour in the retail space that have also been expanding in the past few months.

Liked this article? Subscribe to Food Business Africa News, our regular email newsletters with the latest news insights from Africa and the World’s food and agro industry. SUBSCRIBE HERE

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.