Nakumatt Holdings on Monday filed for bankruptcy and proposed that Peter Kahi of PKF Consulting Limited should be appointed as an administrator to help deal with creditors.
Cash strapped Nakumatt Holdings also closed its 19-year old Kisumu branch on Mega Plaza as it fights to cut back massive debts in a recovery bid.
The giant retail chain Monday pulled down doors on the only 24 hour supermarket situated at a prime location in the lakeside town, denting its ambitions to build a 24-hour economy.
The closure of the branch popularly known Nakumatt Nyanza comes nine months after expanding onto a bigger space following expansion of its Mega Plaza premises into a mall. The re-location came after investment advisory firm Dry Associates disclosed that Nakumatt had raised Sh500 through a short- term loan, to attract a strategic investor.
Workers at the store, whose closing residents predicted after continued drop in stocks, were issued with letters asking them to report to the Nairobi head office to be told the way forward.
- 1 US bankruptcy filings hit 35-year low thanks to government pandemic aid
- 2 How investors were left holding Sh100b bonds they can't cash
- 3 Bankruptcy laws good, but lock out cheats
- 4 Uchumi opens debt servicing portal
There was no public notice on its closure even as goods were carted away to the Mega City branch outside the CBD on the Kisumu-Nairobi road since Friday. Nakumatt Mega City, Kisumu’s largest supermarket by size has also been struggling with empty shelves.
The move is a blow to the Mega properties franchise which had banked on the famed supermarket as an anchor tenant to promote one stop shopping experience at mall as severally others, including the troubled Lake Basin Mall sprouted.
Shiloah Investments, the group of investors behind Mega are among 19 landlords suing Nakumatt for Sh596 million rent arrears owed to them after the retail giant announced it would continue to shut down more branches even if a deal with Tuskeys supermarket goes through.
Dwindling fortunes of giants Nakumatt and Uchumi have enabled the rise of smaller retail chains like Khetia’s and Tumaini, both of which have continued to open more branches.