Will Naivas supermarket suffer the same fate as Tuskys?
What you should know about:
- The death of the supermarket’s founder, Peter Mukuha Kago, in 2010 lifted the lid on the family-owned business’s squabbles.
- Following Mr Kagira’s legal action, South African retail giant Massmart backed out of acquiring the majority stake in Naivas.
- The supermarket’s management fought to put out fires started by irate creditors.Yet unpaid branch managers chose to ‘pay themselves’ from daily sales proceeds alongside inventory.
- Tuskys went from being the poster child for grocery retailing in Kenya to face the same problems that brought former competitors like Nakumatt down.
The ownership structure of Naivas
David Kimani, who owns a 25% stake in Naivas Supermarket, the late Simon Gashwe, who served as the company chairman (also a 25% stake), Linet Wairimu (15%), Grace Wambui (15%), and their late father Peter Mukuha Kago (20%) are Naivas Supermarket directors.
Mr Kagira contends in court that the true ownership structure of Naivas Supermarket should be 30 percent shares held by their late father, 25 percent by his sister Wambui, 15 percent by Wairimu, 10 percent by Kimani, and 20 percent by himself.
Gashwe died in August 2019 while receiving treatment at a Nairobi hospital.
Mr Kagira claimed that Mr Kimani redistributed a portion of his father’s stake to family members while leaving nothing for him.
“That the applicant respectfully requests that the honourable court issue a temporary order restraining the respondent and all directors of Naivas Limited from further sale of shares or interfering with money assets held by Naivas Limited pending the hearing and determination of Appeal,’’ reads part of the application that he filed in court.
Mr Kagira also challenges his brother Kimani’s shareholding, alleging that he illegally allocated himself a 20% stake in the retailer.
When contacted for comment on the court’s decision, Mr Kimani, through the retailer’s chief commercial officer Willy Kimani, confirmed that they are aware of the new directives but would prefer not to comment.
“We are aware of it, but we do not wish to discuss it at this time,” Mr Kimani told the Nation.
The new development comes less than two years after the supermarket chain raised Sh6 billion by selling a minority stake of 30% to a consortium of investors, including the International Finance Corporation (IFC), the World Bank’s private lending arm.
To acquire the minority stake, IFC, private equity firms Amethis and MCB Equity Fund, as well as the German sovereign wealth fund DEG, joined forces.