Kenyan supermarket chain Tuskys is seeking a strategic investor before the end of this month as one way to raise funds, the competition watchdog said on Monday after it told the retailer to clear more than $25 million in supplier bills.
The retail sector has seen two major supermarket chains collapse in recent years, while Carrefour franchisee Majid al Futtaim has entered the market and grown into Kenya’s third-biggest retailer in just four years.
Tuskys, with 53 stores making it Kenya’s second-biggest retailer behind Naivas, was ordered by the Competition Authority of Kenya (CAK) to clear supplier bills worth 2.77 billion shillings ($26 million) last month, under new rules to cushion suppliers from delays.
Tuskys, which has not said how much it still has to pay, has renegotiated terms for its credit facilities and has been in talks with suppliers to keep its stores stocked, CAK said.
“Shareholders of Tuskys have communicated that they are also exploring other funding options, including seeking a strategic investor by July 31, 2020,” CAK said in a statement.
Representatives of Tuskys were not immediately available for comment.
CAK said it would decide within two weeks on any investment proposal by Tuskys, accelerating a process that usually takes months. It has approved Tuskys proposal to clear outstanding debts to suppliers within the next four months.
“The authority shall conduct compliance checks on a weekly basis to ensure adherence to the presented debt settlement plan,” CAK said.
Culled from Reuters Africa
