END OF AN ERA

Creditors drive final nail into Nakumatt's coffin

Kenya's retail giant buried

Nakumatt Staff. /File
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In Summary

• At least 93 creditors with a combined debt value of Sh11.5 billion fully supported winding up the firm

•latest audit reports shows the firm was owes Sh18 billion to suppliers and Sh20 billion to secured creditors.

Judy Wairimu supplied onions to Nakumatt Supermarket before the retailer went under in February 2018.

She was among hundreds of creditors who came to decide the fate of the once giant retailer yesterday at the Visa Oshwal Centre, Nairobi.

When the firm's administrator called for a vote on whether or not to wind up the firm at 11.15 am,  Wairimu left her seat and instead rested her tired frame on a pillar at the far corner of the building.

 
 
 
 

Several minutes later, the verdict was out. At least 92.7 per cent of creditors had supported the administrator's proposal to liquidate the firm.

Wairimu started crying uncontrollably, her hopes to recover Sh68 million up in smoke.

''I religiously supplied onions to Nakumatt for three years up to April 2017. My family and I even borrowed funds to service orders. This is the saddest day of my life. May God punish those who stole from us,'' Wairimu told the Star amid sobs.

She further called on state investigative agencies to go after Nakumatt directors, seize their properties and help creditors recover their money.

Nakumatt's court-appointed administrator Peter Kahi had outlined the negative position of the once vibrant retailer to hundreds of creditors for close to an hour before opening the floor to questions.

Most of the creditors wanted the retailer to return their goods if it had no money to pay back.

''We supplied our goods, they were bought...who took our money? It is either we get our money or goods,'' one of them said.

 
 
 

Kahi, who for the last two years has struggled to resuscitate the retailer stood dejected as he responded to questions and admitting that indeed Nakumatt's directors had run down the supermarket.

 

At the end the day, only 169 creditors agreed to vote on whether or not to liquidate the firm, with many walking out of the room, disappointment written all over their faces.

At least 93 creditors with a combined debt value of Sh11.5 billion fully supported the administrator's proposal to wind up the firm with 48 supporting the proposal with minimal adjustments.

Only 28 rejected the liquidation proposal, perhaps praying for a miracle that would resurrect the retailer.

According to the latest audit report, the firm owes Sh18 billion to suppliers and Sh20 billion to secured creditors.

''The debt is far too much compared to Sh422.5 million we expect to recover from the sale of few remaining assets. We, however, expect some more recoveries from pending court cases. We will distribute accordingly,'' Kahi said.

The administrator will deduct his fee as a matter of priority, pay statutory deductions, followed by secured creditors, while suppliers are expected to wait a bit longer.

Even so, those who invested in the firm's commercial papers valued at Sh4 billion should not expect anything.

Some of the banks owed by Nakumatt include Diamond Trust Bank (DTB) Sh3.6 billion, KCB sh1.9 billion, Bank of Africa Sh328 million, UBA Sh126, GTB SH104 million.

Brookside Dairy Limited, on the other hand, leads the number of suppliers demanding Sh18 billion from the retailer.

The dairy is owed Sh457 million followed by Outstand Logistics Limited Sh415 million, Norkan Investments Sh338 million, New KCC Sh290 million while high-end furniture maker Redstar International closes the list of five top creditors at Sh261 million.

Suppliers are now left hoping to get 46 per cent of the value of their goods from tax refunds, even as the taxman pursues the retailer over a Sh2.1 billion tax bill.

It also emerged that the retailer was not remitting its employees pension, owing NSSF Sh78 million. Former employees are on the other hand demanding Sh400 million in salary arrears.

The court is now expected to appoint a liquidator on January 17 to end the 33-year existence of retailer whose journey began in Nakuru in 1987.