By Kampala Sun writer
Nakumatt Supermarket is set to merge with Tuskys, another regional retailer, in a bid to rescue its crumbling business. The two arch-rivals signed a merger deal which will see Nakumatt, the biggest retailer in Kenya, access stock from suppliers using Tuskys supermarkets’ goodwill and value chain.
Although the brand will remain the same, Tuskys will provide managers to offer leadership to the hitherto struggling Nakumatt stores across the region.
Kenyan media is reporting that Nakumatt Chief Atul Shah and his family have agreed to pledge his shares for six years to the financiers with the hope that this will offer a solution to Nakumatt financial challenges.
“This is a home-grown solution. The deal will allow Nakumatt access stock immediately and once it has stock then it can get the cash flows to remain afloat,” One source familiar with the deal is quoted by Kenyan Media.
Nakumatt has been faced with financial woes that have seen several stores close down both in Uganda and Kenya, as day by day, the shelves were becoming emptier. It was revealed that the company was collapsing as a result of multi-billion Shillings debts to suppliers, banks and tax bodies.
Last week, it was reported that Uganda Revenue Authority had commenced the auctioning of Nakumatt Supermarket’s goods to recover USD 71,000 (2.5 billion Shillings) owed in taxes with clearance sales at Bugolobi and Kamwokya.
Nakumatt has been sued by a number of suppliers demanding payment.