The management of Tuskys Supermarket has been unable to access at least 20 branches after respective landlords seized goods over accumulated rental arrears.
The management has now moved to court to pressure its landlords into releasing its assets and potentially allow it to rescue the falling retail giant.
Tuskys told the High court that it intended to sell pre-selected non-core assets to facilitate them resume operations and eventually pay its creditors.
The retailer hopes to reach a target of Ksh911.5 million which will allow them to restock its other outlets and settle unsecured debts.
Landlords have however obtained orders to seize the retailer’s assets over rent default in Nanyuki Mall, Eldocenter, Shiloa, Mtwapa Mall, Mega Mall, Pioneer and Karen Crossroads.
Others are Lolwe in Kisumu, Ananas in Thika, Buru Buru, Juja City Mall, Chigware, Milele, Kitengela, Adams, Malindi, Northview, Uthiru and Mirema.
“The applicant has already identified potential purchasers of the aforementioned non-core assets, which purchasers similarly operate and run supermarkets under various names and styles. These intended purchasers shall, in addition to purchasing the applicant’s non-core assets, take over the applicant’s premises as new tenants in the said outlets," lawyer Patrick Onyango said on behalf of the retailer.
Tuskys has already made an agreement with Diamond Trust Bank (DTB) which holds a security interest over the assets designated for sale.
However, the continued closure of the outlets by landlords has slowed down its plans to raise cash.
“On this premise, the applicant continues to accrue rental and utility arrears on the premises and the assets continue to remain at risk of dissipation and predatory creditor actions,” Ogola added.
Tuskys is also seeking to sell a majority of its stake to a consortium of a private equity firm and an undisclosed retailer.
This justifies the retailer's need to raise capital which will ease its financial pressure, giving it more time to negotiate the sale of the stake.
Tuskys disclosed that it needed at least Sh2 billion to survive in the short-term as piling debt led to supplier desertion, stock-outs and closure of some of its branches.
