Cash strapped Tuskys Supermarket is set to auction property worth over Ksh911 million even as creditors fight to have the retailer liquidated.
The retailer is targeting assets such as furniture, fixtures and fittings in 19 branches that have been closed due to rent arrears.
“The sale of non-core assets has been set out in the applicant’s recovery plan as one of the sources of capital to finance the applicant’s recovery, aside from its investors’ capital injection. It is also a key aspect of the applicant’s plan to trim down its branch network,” Tuskys said in court documents.
Tuskys now wants the liquidation case filed by Hotpoint Appliances deferred by one year to give it time to sort the issues.
“It is also the applicant’s submission that a liquidation of the applicant in its current financial state would offer no reprieve to its creditors as it would be unlikely that the creditors would recover the totality of the debt owed to them. In particular, the unsecured creditors would likely recover nothing after settlement of debts due to secured and preferential creditors,” added Tuskys.
The retailer was hoping to get a capital boost of Ksh2 billion from an undisclosed Mauritius-based firm to turn around things.
However, the chain retailer received Ksh500 million from the unnamed firm in September 2020, which was not enough to turn around things.
It later emerged that the unnamed investor is demanding that the seven siblings who own Tuskys place all their shares as security for the loan, which they will have to cede in case they default the loan.
Following the squabbles with creditors, Tuskys has seen its branches drop from over 53 to less than 10 in less than one year.