- An insider who begged to remain anonymous told the Star yesterday that the firm's sales were intact, pointing the financial woes to mismanagement.
Property of Juhudi Investment, guarantors of Kaluworks Limited, a subsidiary of billionaire Manu Chandaria’s Comcraft Group, is facing the auctioneer’s hammer over default.
An advertisement by Keysian Auctioneers placed in a local daily Wednesday shows that Juhudi Investment's property whit sits on a half an acre piece of land along Forest Road in Nairobi will be sold to recover unstated amount of money borrowed by Kaluworks.
This is a repeat of the same scenario witnessed in January last year when local lenders including I&M Bank, NIC Bank and Bank of Baroda instructed auctioneers sell off properties belonging to Kaluworks and its guarantors to recover Sh6 billion debt.
Kaluworks, one of Kenya’s leading manufacturers of aluminum utensils and roofing sheets,has been struggling financially over the last few years on the back of weak sales and increased competition from other cookware manufacturers.
The firm's financial woes forced underwriter, Sanlam Plc write off Sh1.15 billion. This saw the insurer record a net loss of Sh1.53 billion net loss in the first half of 2018.
The firm started hitting rock bottom in 2012 when it issued the Sh1 billion bond with a tenor of seven years to fund its expansion plans, which saw its debt position soar to Sh4.6 billion at the end of 2012, compared to Sh1 billion in 2008.
Although it managed to payoff the bond two years before maturity to improve its creditworthiness which had been downgraded by South Africa’s Global Credit Rating company to BB from BB+, its financial woes worsened by the entry of cheap imports from China.
An insider who sought anonymity told the Star yesterday that the firm's sales were intact, pointing the financial woes to mismanagement.
''The firm can hardly meet current demand. Apparently they have to purchase raw materials from another local subsidiary ...we know how the story goes,'' he said, alluding to inside trading.
''A client recently placed a huge order with these guys and they are unable to deliver. Lorries from as far as DRC camping at the factory for weeks as they cannot deliver. It is not a sales issue,'' he added.
Communication officers both at the firm's Nairobi head office and Mariakani were reluctant to comment or connect us to the managing director.